Full text of Hearings before the Reserve Bank Organization Committee - Cleveland, Ohio

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STENOGRAPHER’S MINUTES

THE RESERVE BANS
ORGANIZATION COMMITTEE.

"FEDERAL RESERVE DISTRICT DIVISIONS AND LOCATION
OP FEDERAL RESERVE BANKS AND HEAD OFFICES. "

TS.

At______ Cleveland, O h i o .__________
Date_________ Febnuary




1 7_t__l914z.

Law Reporting Company, Official Stenographers
115 B R O A D W A Y , -N E W YO R K
T E L E P H O N E . 2 6 2 0 R EC TO R

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4535
Clevel

.id ,O h io ,

F e b ru a ry !?,

1914 .

The Orga.ii za :io.-: Committee met pursuant to notice
at 10:00 \.
PRESET:
TH^ SECRETARY OP THE TREASURY.
THE SECRETARY 0“ AGRT CULTURE.
APPEA'-A^CES:
J. J. SULLTVA.', president of the Central ‘ational
Bank and the Superior Savings c: Trust Company.
H01-. 3E7T0-” 0. EAKER, r^yor of the City of Cleveland.
Is*. C. STO'-E, President 'ational City 5a.:k,
of Akron, Ohio.
E. R. 5’
Ai'CKER, Vice-President U.iion *ysatio».al Eank,
Cleveland, Ohio.
A. E. ADAT.'S (Young sto-.-:, Ohi. ) Pi^st National Bark
and -he Dollar Savings & Trust Comply of Youngstovr.i, Ohio.
JOiCy Y. EAS STULL (Cclumbus, Ohio),

JOH: T-. HA TLTO'- (Coluribus, Ohio), American
iiuaran ty Compa n y .
J. J.

JEi>! T'-GS (Coluubv.s,

Ohio),

C i t y N a t i o n a l Bark .

C. K. HTl'KA’- (Columbus, Ohio) Manager Columbus
Cleaning House.




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4536

I.

•« KTTst;/TTTrC,T*jR.> Chair .a-i Committee "epresenting

Central Ohio, Columbus, Ohio.

The S c~ etary of -lie reasu-^:

Gentle en , this Committee

is changed rrith the duty under the Feder- 1 “oserve Act of
dividing the country into jot less than eight nor tuo*e than
twelve federal i'cse^nre districts, locating a Federal Reserve
Bank in each one of those districts.

The law requires us

to have due regard to the convenience and customary course
of business in each district.

Our* object in visiting

Cleveland is :o elicit the

facts •
“elating to this

part of the country, a ?d re are prepared to hear such
witnesses as you hsr e to prese t.

I see from c’ie list

that Colonel Sullitzsn is the fi-st r/itness on behalf of
S.

Cleveland.

Ts that right, do you desire to be called

first, Colonel?
'r. Sulliva •: tf you please.
i

• STATE T T OF

J. SULITVA-:.

The S..creta"y of the Treasury*



“'ill you state your full

rjame and occupatio., Colo el Sullivan*

G-3

J-.

"ir.

J.

J,

Sullivan:

Sullivan

J.

-a t i o n a l B a -k a n d

Company

of

The

Secretary

Tir.

Sullivan:

Clearing
of

^ ep> e s e n t
other
that

The

Eank

I

the

with

to
in

you

like

t he
in

of

the

C lia ir ma n
of

this

two

of

&

the

Trust

particularly

it

also

Chairman

of

this

city,

named,

is
the

in

and

many

that

capacity

location

' ow b e f o ~ e y o u
outlining

a map h e '* e ,

before

of

a

!'r.

begin,

thedistrict?

Secretary,

which

you.
file d .)

Treasury:
to

t he

and

Commerce

T presume,

have

represent

o f Cleveland.

Treasury:

the

city,

and

do y o u

a Committee of

organizations

was accordingly
of

of

"hat

to y o u r e g a r d i n g

a map,

place

Secretary

Savings

And

Cleveland,

the C ity

7e

to

( T h e map

yourself

Treasury:

Chamber

speak

have

Sullivan:

would

The

the

T am th e

of

Secretary

Colonel,
I\r.

of

along

T desire

Superior

of

city.

organizations

Reserve

the

House A ssociatio n

a Committee

T am president

Sullivan.

Central

this

4537

District

Do y o u
'-o.

-:an;

to a d d r e s s

5 , a s r e p r e s e n t e d on

tfais m a p ?

S
': y .
of

the

Sullivan:
United

approxim ately



Tf you

States
as

please.

7e

suggest

Into

eleven

Federal

outlined

on t h e

map w h i c h r e

the

Reserve

division
districts,

submit

for

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J.

you-

Act

can-iot b e

Ary

attempt

cial

of

7 e have

with

respect

divide

the

The

potentially

thes.

have

that

the

The

by

Reserve

of

district

great

large

city

finan­

areas

a

we

and

to

cial

but

through

grow

to

us

power,
if

each

to

not

suggest

of
to

the
be

aod

not

bank

will

recent

in

now or
a n d with-

we b e l i e v e

merely by

ar.'d p e r h a p s
of

and

fi.;a. c i a l

strength;

also,

to

as p o ssible

accessible,

indicated,

are

in

regard

business",

eleven we

location

character

suggest

of

equitably

readily

are best

with

d lending

scots

center,

"ate

cou-'se

the

the

which

fi

districts

an

certain

d position,

districts

tho

self-contained

of

suggested

t* *a d e

the

number

in

too

country

banks

are

commercial and

-eliably,

the

smallest

in a

size a

each as

of

qualifications

present




-

"re h a ^ e

each d is t r ic t

adequate

a =d customary'-

bo-rowing needs

districts
strength.

covering

Federal

rye t h i n k -70u l d

further

the

to

to

smaller

each of

resources

equally.

number

the

country,

outlined

also

a

of

overwhelming ba-ks

the

icnce

attem pting

the

ov d is t r ic t s

rest

"conve

;he pu-poses

served w it h

lim it

either

centers,
the

that

well

to

necessitate

the

4538

Sullivan

cojsideration.
"/e " b e l i e v e

out

J.

mo'*e

growth.

•"e s c - ' i b e d

on

a

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453g

schedule which we have designated as "Exhibit A", the head­
quarters being as follows:

Dist ict 1, Eosto.; District 2,

8W York; Dist'-ict 3, Philadelphia; District 4, fichao^d;
District 5, Cleveland; District 6 , Atlanta; District 7 ,
Chicago; Dist-ict 8 , St. Louis; District 9, Dallr.s;
Dist-ict 10, T"i_’..capolis; District 11, Sail Francisco.
In District :o. 5 we have included the ©’tire state
of Ohio, 9 counties in -estem J'sw York, including Buffalo
and Rochester, 25 counties ia western Pennsylvania includ­
ing Pittsburgh and John stown, the 4 counties constituting
-he Pan-nancle" of rest Virginia, including The ellag, and
19 counties of southeastem Michigan, including Detroit,
La ising a..id Bay city.

Tithin this district there a~e 8l6

national ba^ks having a total capital and surplus of
5250,5c0,000 which ,rould be members of a Federal Distr-ict
ba-.k with a capital of §13,800,000.

The deposits of these

banks aggregate :)l,042,000,000.

The state banks in the

District have capital

agg

and

surplus

and deposits of )l,356,000,000.

egating *251,300,000,

The population of the

district, acco-ding to r.he census of 1 9 1 0 , was 1 0 ,287,292.
‘e believe it is obvious that a district in the no“th
between ' ew York a: d Chicago i s absolutely necessary to



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limit vhe tremendous ba ;ki..g power acquired by those two
centers of fi -anee und-.r our old la-:, as well as to enable
eacn of those centers to serve its own community best.

The

Diet ict Reserve banks in 1'ew York and Chicago will neces­
sarily be g-eater tha.: a zy others, eve’ *^hen such a midway
c.isv-ic- is established.

Ie believe it essential, however,

to attach to other centers as much te— itory as can reason­
ably be separated f"on the 'vew York district, and some of
t.
he ‘
:e.ito:V which u ,der the old conditions has centered
its banking ir? Chicago.
-o -uiid.el;: , between these two great centers there
lies a natu-al district, hich •••£ believe is as cohesive
in its i .;ust ies, commerce, exchanges aud fi ancial
f)--oblems as can be found any 'here in the world in a like
area.

Tnis is the great i’-c; a..d steel p-oducing territory

csn werin;? in -'o: the-n Ohio; a dist~ict ’’hich has such
ma ufacturi-jg advantages i: va~ied lines, added to great
mineral and agricultural resources, that it has developed
a remarkable diversity of i.dust ies and comme-ce, loosely
allied, not discordant, yet offering a distribution of
fi»-» oial Requirements which approaches the ideal.



1‘his dist- ict has become so great in manufacturing

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that its agricultural resources are often forgotten. Census
figures sho^r, for exa^le, that Ohio ra.iks fifth among the
states in numb er of farms, sixth in value of farm property,
sixth in production of com , fifth in to. s of hay produced,
sixth in value of potatoes grown, thi--d in production of
wool, sixth in pounds of butter produced, sixth i-. fallons
of milk, third in dozens of eggs,* and the list might be
extended.

But the meeting of bituminous coal and iron-ore

4

in this district has made it preeminent in most forms of
i’-on and steel production, the g'-'eat barometer of business;
Ohio is fourth in production cf bitumi ?ous coal, and second
in production of pig-iron.

This region 0" district has

moreover such advantages for the distribution as 'fell as
pr\>duction of so many articles of manufacture, not only
those using iron and steel as their chief material, that
it nits taken on chief importance as an industrial district.
The census shows in this district nine manufacturing cities
,of ao’-e than 100,000 population, as follows (in order of
rariX); Cleveland, Pittsburgh, Detroit, Buffalo, Ci cin.ati,
Rochester, Columbus, Toledo a .id Dayton.

These cities alone

produce annually manufactures valued at more than
'il,<00,000,000.



The census lists of leading classes of

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products in these cities sliov a remarkable diversity; araong
the classes shoeing the greatest value of p-cducts in
each city are the folloviag:
Poundry and machine shop products
Primary iron a id steel
Automooiles a :d automobile parts
Packing house p-oducts
Soap
lie 1 s and tromer. 1 s clothiig
Boots and shoes
Pri -ti..g a :d pv.bli shing
Petroleum refi .ing
Plour a d grist mill products
Bak o-*y pro ducts
Coffee a.d spice roasti ng and g-inding
Tobacco

manufactures

'.alt a.d spirituous lijjuors
-^“ass and bro. Be products
7e believe it is deraoi.strable that the seasonal demands
x’or loans in the comme-ce and indust"ies of this district
ctvre as evenly distributed throughout the year as v/ould be
possible in any district that could be outlined a.ywhere.



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4533

Eve? r'ere the district limited to iron and steel ma ufactures, the dama. d would be distributed by the re-7 fact
that the processes are all carried o--. within its bonders,
from u loading of iron-ore to assembling the most highly
finished products.

For example, the season of trie year

when Cleveland has the least demands fcloans on its
i dus tries, particularly its ore, pig-iron a.:d primary
steel, is the very season when Detroit has its greatest
demands for financing its automobile products.

^e might

multiply instances, but we believe the probability that
the district will always be self-reliant is indicated
sufficie tly by a table and accompanying chart which we
have prepared (and marked "Table A" and "Chart T",) show­
ing percentages of rese^es in Each of the reserve cities
in this district at the date of each Comptroller's call
for a pe ’iod of three years,
'Tith all the diversity of industry, commerce and
agriculture in this district, the-e is •;eve~theless a
certain relation even between the most diverse.

Tn

Cleveland, for example, our women's wear mar.ufacturers not
only employ other producing members of :he families of
our machinists, but some of our largest foundries are owned



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"by textile goods manufacturers; a ;fi other iite*-relations
make for understa dig of each other’s problems, a d mutual
helpfulness.

^e believe that the ba kers of all the

dist- ict we have outlined would have sympathetic understa.-ding., if

ot absolute knowledge, of the fi^a cial

problems of all die ma...uiactu-e 's, mine s, farmers and
merchants of the district..

'•ow this would ..-ot be true if

the district were to i .elude much of the tobacco a.,d cotton
territory south of the Ohio fiver, where the agricultural,
commercial and industrial conditions a-e utterly divergent
f-om those of Ohio.

'Ve thi..k there would be a lack of

mutuality which would be likely to affect the southern
territo'“y unfavorably, because of the p“eponderance of
no'them p-obi -ms a d ~,equi~ sncnt s, a .d lie probable
majority of r.o-them s cockholders and directors.
The location of the bank to serve this district Trill
doubtless lie between Cleviiknd and 3i cin ati, because the
other large cities within the district a- e so
eastern a d vestem boundaries.

However, Pittsbu"gh has

also claimed to be able to serve Ohio.
Tjossibl:'- between these three.

ear its

Your choice lies

You -dll, of course, select

■the city <iiich ca i, in your judgment, best serve the dis­



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4535

Tt is our purpose i.j this presentatio.o to assist

you in forming a correct judg' ent; we sliall try to avoid
mo'-'e local pride, a id present Only the facts and figures
tha t have convinced us, as we thi,.k they must convince you,
that the business interests of this dist let Tpould he best
served by locating the headquarters ba..k at Cleveland.
T/e are frank enough to say that no city in this
district can substantiate the claim, as Chicago car. for
instance,, that the great bulk of the trade of the proposed
district centers there.

So if you establish a district

with Ohio as its great nucleus, you will doubtless place
the ba.?k in the city that best meets the following require­
ment s:
(1)

Sat isfactory com Ainic atio ~ throughout the

district.
(2) Proximity to center of traffic a d exchanges
of the district.
(3) Pi:-.a..cial, commercia 1 , i.idust-ial a.-.d civic
st ength in itself.
Satisfactory relatio s w ith the e. tire district.
■
re shall confine ou-- evidence to a comparative showing
r o r the three cities under each of these four heads.



The

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4536

few essential facts a.-jd figures have been compiled with
great care, accuracy "being sought at whatever cost; and
we "believe they a~e absolutely reliable.
(l)

Communicatio..:

Tt is probable tha t the

com vu-ication throughout the district from a--=y o.:e of the
three cities would be satisfactory to serve the purpose
of the bark.

jt is certai-ly t ue that a letter mailed

f"on Rochester, John sto-ni, Ci -cinnati or

S a g ii :a w ,

cities

in the -'emotest parts of the cist"ict, at the close of
backing hou-*s on one day would reach Cleveland in time to
receive attest io : at the begi-

:ing

of ba

king

hours on

the .'-.ext day;and this would even be true of most if not
all communities of eastern Kentucky and eastern Tennessee,
if the district should extend so far.

Tt is worthy of

note, furthermore, ihat a letter mailed at the close of
banking hours at any one of seven of the other District
JBeserve cities indicated on our map, would reach Cleveland
in^.-ie co -eceive attention du"i ,3 the following mo-ning,
?Ioreovcr, we believe it ca.. be shown that Cleveland
can be reached by most of the people in the district more
quickly than either of the other cities.

The debatable

te'*”itory, so to spoak, is all within the state of Ohio.



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Tt is obvious that Pittsburgh ca.i be reached by Pennsyl­
vania towns more quickly?- than can Cleveland or Cinci .ati;
it is obvious that Ci. cin.nati could be reached by town s in
Kentucky mo"e quickly than Cleveland, if Kentucky were
included in the district; it is obvious that Cleveland can
be reached by ’.ichigarj a._d V-ew Yo~k points more quickly
tha-. either of the othc
three cities.

cities.

But Ohio lies between the

Of the 37 cities of Ohio containing &

population of 10,000 cr mo e in 1910 (taken as indicating
de. sity of population), 1 7 , with a total population of
1,130,000, car? reach Cleveland most quickly; 14, vith a
population of 902,000, can reach Cincinnati most quickly;
a,,d 6 , with a population of 1 0 5 ,000, can "each Pittsburgh
most quickly.

Fifteen of these cities, with a population

of 1,064,000, are a loiige1* journey from Pittsburgh than
from eithe" Cincinnati or Cleveland; 1 7 , with a population
of 427,000, are furthest from Cincinnati; while only 4-,
with a population of 73,000, are furthest from Cleveland.
To make the point clearer by a system of scoring; if 100
poi’vts a-~e allowed for the quickest communication, and 50
1 or tire second quickest, the score is: Cleveland, 2 ,350,
Cincin ati 1,55®, a d Pittsburgh 1,35°«



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exchanges:

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location with respect co ce.?ta- of traffic and
There a--e 88 counties ia Ohio.

The population

of the 44 counties iio~th of a line dravTr. approximately
through the center of the state is 2,54-7,721; of the 44
southern ecu ties, 2,219,400.

Density of traffic, rrhich

means density of exchanges, can be indicated fairly by
railroad facilities for handling the traffic.

There are

40 main-line tracks in service on the railroads traversing
the northern part of Ohio, and 25 raaiv— line tracks for the
railroads traversing the southern part.

In the north half

of the state, ten railroads have two or more mai. -line
tracks; i i the south half, only three have as ma.y as t’7o
mai v-line tracks; .

The total double-track

mileage in Ohio, as sho^n by the most recent map cf the
Ohio Public Service Comriission, is 2,107 miles.

Of this

double track mileage, zao~*e tlian 1*458 m iles, o~ nearly
70;. lies in the northern 44 counties; not quite 659 miles,

o^ a lit-le over 30;0 is in the south half of the states
7ith “espect to the railroad situation of Cleveland
this part of the state, it is only 'jecesaary to say
that every

eastern trunk line of the United States enters

Clevsland, a...d that the city is o - the principal travel



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highway between ^ev York a d Chicago.

7ioreover, and

equally important, Cleveland is on the most direct line
from the iron-ore of ths northern states to the bituminous
coal deposits of chi s district,

practically all of the

shippiog carrying the iro,>ore trade of the lakes (amount­
ing to 5°-000,000 to.is last year) is directed from Cleve­
land, and about 80,. of the great fleet of vessels ergaged
in che o"e and coal trade a"e managed at Cleveland.

You

doubtless have in mind the fact that the tonnage through
the Detroit fliver to and from lake Erie ports is greater
than the total port tonnage of Tver/ York, London and Liver­
pool combined.

Furthermore, the value of this ton-age,

as estimated by the United States Government K&giiieer at
Detroit, was io e than *800,000,000 iA; 1910; a fargreater
sum than the total

eported by the Census for the value of

both the agricultural and manufactured product of the
states of Kentucky and Tennessee combined.

This indieat eft

the unreliability of the argument that Cleveland is a leS3
desirable center for this district because it lias the lake
to the iu~th,

The lake is a far more valuable source of

=• d exchanges than a^y equal areas of land.

The

jruat i.ikw3 i’ur.-.ish the cheapest freight haul in the world,



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<7. S u lliv a n

so that the iroi^-ore, coal a.:d limestone for the production
of pig-iron can "be assembled on the south shor-e of Lake
Erie mo"e cheaply tha
districts in the north.

in any other of ihe great furnace
We note also that nea~ly all the

cities you have been co. sidering as locatio.-.s for dist-ict
"banks a-e situated, not in the geographic centers of their
districts, but at the points where li :es of comnu-ication
center, ^'hich happen to be, in no st cases, at or near one
edge of each district; and especially when any district has
any frontage on lavigable water, the trade of the district
is likely to seek a port city.
(3)
strength:

Financial. commercial, industrial and civic
Cleveland is the latest city between the

Atla tic seaboard a d Chicago, a d its populatio

is

exceeded by only three citios of the seaboard --

ew York,

Philadelphia and Boston -- a-dttro cities of “he interior -Chicago and St. Louis*

The United States Census of

Manufactures for 1909 shows that the value of the manu­
factured product of Cleveland is exceeded only by that of
fou- cities, i>ew York, Chicago, Philadelphia a d St. Louis.
Cleveland's rapid growth to this position is due largely
to its strategic locatio-: a .d transportation facilities,



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4541

which, have been the chief of its manufacturing advantages.
These natu-al a d eco.-.-omic advantages, aided by individual
enterprise and the application of intelligent public spirit
in cooperative effort, have produced the phenomenal but
steady and substantial advance of Cleveland among the cities
of the country.

Tn 1850 Cleveland was 43rd in population

rank; today it i3 the Sixth City.
As indicating the volume of t-ade now centering in
Cleveland, we give below a table of a few of the leading
commodities handled by Cleveland busi ess houses, with the
approximate volume cf an. ual business in each line,
conducted through Clebeland banks, as ascerta ined from
reports furnished by a la-*ge number of leading business
houses., and f"om most recent census -reports.

The financial

-needs of each of these lines a^"e distributed over a large
part of the year, ' .
Connod it y

Iron o e

Annual volume.
)64,000,000

Bitui_iinous coal

5 6 , 000,000

Petroleum and its p"oducts, etc.

33,500,000

Lumb er

15,500,000

Sto :e

1 5 ,0 0 0 ,0 0 0




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Orai 'ii a^id hay

$19 j000,000

live stock and packi g house products

40,000,000

P”imary iron and steel products

3^,000,000

Foundry and machi.e shop products

48,000,000

Automociles and automobile parts
and accessories (manufactured)

43,000,000 x

Ms:71 s and T/oaen 1 s wearing apparel
(factory product)

32,000,000

Total a:-xiual value of "he above
commodities
x

398,000,000

(Part of this total is probably i--eluded in the value
of "Foundry and machine shop products".)
7o believe that the selection of normal trade centers

for the districts you establish can be made almost un­
erringly "by a study of ths "ate a d character of growth of
the chief cities in each district.

The present size,

trade importance and fi'a-icial conditio, of the cities
considered are of course m c st important factors; but you
are pi a.'::ing fo™ the future as v/ell as the present, and
growth is, we believe, a clearer index of probable strength
than present size, if the tvo factors do

ot coincide.

7 e believe, therefo’e, that we can best aid you in select­
ing the headquarters for this district by shoeing the




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4543

history of recent growth in Cleveland, Pittsburgh and
Cinci.? .ati.
Before considering the figures of financial growth,
you should be advised that since the enactment of the
national banking law, Cleveland is unique among these three
cities, in having reported not one single failure of a
•national hank; no depositor in aay national bank in
Cleveland has lost one penny.
In o"der to limit as severely as possible the figures
which we feel must "be brought to you:' attention, -re have
co.fined our evidence of relative growth to a very few
index items.

T^ese are

ot chosen for the reason that

they favor Cleveland; we believe that all the recorded
data would indicate equally ^ell the indisputable fact of
Cleveland's advance; but we believe the following items
will oe sufficient for reliable comparison.

Fo~ each item

we give the percentages of increase for the most rece.t
ten-year period for which authoritative data are available,
*5 follows:




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4544
Cleveland Cf^cif.-.ati P i t t s

Population, I9OO-1 9 1 O
Post office receipts, 1904-1913

46.9

11.8

burgh
18 .2

116.4

61/.3

107.5

Value of manufactures,18S9“1909

95.1

37.3

11.1

Clearing House exchanges,1904-1913

57.8

16 .1

23.9

Deposits, all backs, 1904-1915

6 6.1

37.5

36.2

(Te offer in evidence Tables B, C,

D,

E a;d F, and Charts

IT, TTTjTV, V and VI which, show clearly the annual growth
of the three cities as indicated by these items.)
.Civic coi.ditio s may seem to be a minor point in your
co sideration of a purely eco omic problem, but we believe
they have a very distinct bearing.

(Cleveland has a

served reputation for freedom from "graft" in its municipal
affairs; but that is a 'negative virtue, and is perhaps only
a mi •-•or evidence of the alert progressive spirit which is
constantly manifested by the great body of our citizens
ai d their leaders in ma: y ways. )

For example, Cleveland

enjoys the lowest death rate among the large cities of the
country, due in part to climatic conditions, but also in
large part to intelligent municipal sanitation.

Cleveland

was the first American city actually co begin putting into
effect a great plan for grouping its public buildings in
a "ciric center".




Cleveland's experiments in charities

-“ 21

j.

j # S u lliv a n

4545

and correction are attracting worldwide attention and
serving as models for other communities; the famous Cooley
i!arm Colony, the Cleveland Federation for Charity and
Philanthropy, a d the new"Cleveland Foundation" are
exa-iples.

To Cleveland has b esn evolved the u. ique street

railway franchise (which may "be credited largely to the
work of die late Kayor Tom L. Johnson a d the late United
Svates Judge Robe-t

Taylor) the essential features of

which are the control of service by the city; the kind of
service the people's rep-ese:-tatives require, at a rate of
fare which * 1 1 1 pay its cost plus 6p upon an arbitrated
valuation; and the consequent satisfaction of the people
because a problem is solved which in other cities is a
co -staii- source of disturbance of both business and banking
conditions.

The citizenship of Cleveland expresses itself

noc only at the polls, but also through civic and commercial
organizations, in *'hich effective voluntary service for the
improvement of living and working conditious in Cleveland
is rendered most freely by a very large number of able men.

xX

Thfese facts we cite as reasons for the growth of Cleveland
ii the past, and

s evidence of its healthy condition and

n^hflble continued growth, so that in the future still more



6- 22

J.

J.

S u lliv a n

4546

tha"* at present, Cleveland is likely to be the u.idi spumed
t:*ade center of this district.
(4)

Relations with District: It is natural that in

a district like this the smaller cOB.nuj.iities and rural
territory T'ould all p-~efer to oe attached -o ./he nea eslarge city, With which trade relations are closest; and i~
is natural, too, that no'e of the three cities under con­
sideration should oane either of the others eva,’ as a
second choice, because the"e has been a friendly but
intense rivalry between these cities.

Si .ce Cleveland

continues to outgrow the other two, re believe that it
should

ot be subordinated to either.

Yet Pittsburgh and

Cincinnati ca not be expected to yield ungrudged precedence
to their successful rival for preeminence in the middle
Testi
But the business me., of all this district enjoy
friendly, profitable and ever, co-dial relatio.. s with each
other;

and we are certain that the^e would be ro r-eal

disturbance, much less violence, do;ie ;o existing ^rade
conditions in Pittsburgh, Cincinnati, Buffalo, Detroit or
7oche ster, o'" a ?y other locality within the district,
thorough the establishment of a ba. k at Cleveland.



Six

C— 23

J*

S u lliv a n

4547

hundred a d twenty-four national a ?d six hundred atite
banks within the district now carry accounts with Cleveland
national banks, besides two huid-'ed a..d seventy-.ine
national and o e hundred a. d twenty-one state banks beyond
the district.

About five hundred banks in the district

have designated Cleveland banks as reserve agents.

Cleve­

land has fortir-five per cent of the total of all "bank
deposits" in all Ohio banks .

T/e have heard directly

from two hundred and thirty-three ba :ks in northern and
central Ohio who :one Cleveland as their first choice for
the lo cat ioii of the district ba.ik, as well as twenty banks
in southern Ohio, four in southeastern Hi chigan, five in
westeni Pen.?sylva ■ia, two in "'ew York, and ev m seven in
Indiana; and we are certain that maiy oSher banks in
surrou.ding states and in southern Ohio would find Clevela.d perfectly acceptable, if -..ot their first choice.

To

show that our city lias the active good "rill of business men
in its immediate trade territory, we submit herewith copies
of resolution s from co::imercial and trade organizations in
thirty-three Ohio cities a d towns; resolutions formally
adopted by Clearing House Associations in some of the
cities; and editorials that have appeared in several Ohio



c—24-

J. j. Sullivan

4548

newspapers outside of Cleveland.
tfe submit these facts a •d co.'.-siderations with the
conviction that they establish clearly the desirability of
such a district as we have outlined, with Ohio as its
center, and with its Reserve Sank at Cleveland.
Respectfully submitted,
J. J. Sullivan, Chairman Clearing House Committee,
■Newton D, Baker, ;layor of Cleveland,
Warren S. Hayde*:, President, The Cleveland Chamber
of Commerce,
Elbert K. Baker, President, Plain Dealer Publishing
•Company,
p. H. Goff, Rresiden I , Cleveland Trust Company.
These ge-tlemen constitute the Executive Comm i^-ee, a
we a>*e represent ing Committees appointed by




The Cleveland Clearing House Association,
The

Cleveland

Chamber

of

Commerce,

The Cleveland Builders Exchange,
The Cleveland As soc iation of Credit ^en,
The Cleveladd Real Estate Board,
The Cleveland Advertising Club,
The Industrial Association of Cleveland,

G“ 25

J.

J.

S u lliv a n
45 4 9

Cleveland Rotary Club,
Lake wood Chamber of Commerce,
and indeed the entire population of the City of Cleveland.
I thank you very much, gentlemen, for your attention.
We have letters from bank men in Detroit and Euffalo,
and from Toledo, some expressing Cleveland first choice
and Detroit especially expressing second choice, the first
choice being Chicago and the second choice Cleveland.
The Secretary of the Treasury:

Just give us the substance

of those.
The Secretary of Agriculture:

Just read the essential

parts of them#
The Secretary of the Treasury:

And have you the letters

to ’/hich these are responses?
3ir. Sullivan:

I think not, no, Hr. Secretary.

The Secretary of the Treasury:

Are these solicited

or voluntary?
?r. Sullivan:

’Tell, they are invitations for them to be

here to attend our hearing.

»ow this is from Detroit:

"As I advised you by long distance relative to our
Bankers endorsing Cleveland for second choice for Regional
Eank, I found while all rvould be in favor of Cleveland as



0-26

J.

J.

S u lliv a n

4550
between either Cincinnati or Pittsburgh, the majority
felt that as at a meeting of our Clearing House Association
we had unanimously selected Chicago and had sent a Com­
mittee to Chicago at time hearing vras held by Secretary of
Treasury, and advised the Sec-etary to that effect, they
felt that v.'e ought not to express a preference for- any
other choice until such time as Chicago failed to secure
this District, if it should.

That any other course might

possibly weaken Chicago and at the same time be considered
by Chicago Bankers that we were not acting in entirely
good faith*
Por these reasons they decline to make second choice
at present time. "
Hence we could not change their position.

The:/ still

stand committed to Chicago, but as they say, they express
a preference for Cleveland as against Pittsburgh and
Cincinnati.
The Secretary of the Treasury:
Mr. Sullivan:

5y whom is tha t signed?

William Livingstone, ex-President of the

American Bankers Association.




This o ne is from Buffalo:
"R e p ly in g to your- l e t t e r of the 1 1 t h :

We beg to say

G-27

J.

J.

S u lliv a n

4551

that Cleveland is our second choice, our first choice, of
course, being Hew York City."
This is from Mr. Harry T. Ramsdell, Cashier of the
Hanufacturers & Traders National Bank, in Euffalo.
Ths Secretary of the Treasury:

7e will permit these to

be filed as exhibits p”oviding the lette“s to which these
are responses are filed with them.
Vr.

Sullivan:

7e will be glad to furnish them.

The Secretary of the Treasury:

Furnish the correspondenc

in other words, so we may see what representations were
made as the basis of these expressions.
!•!r. Sullivan:

7e will be glad to do that.

This o..e is

from Toledo:
"I beg to acknowledge receipt of your favor 1 2 th
inst, a-.d thank you very much for the invitation to meet
the Comm ittee of the Federal Reserve Barks on Tuesday next
T regret exceedingly that it will be impossible for
me to be with you, but T think "he^e will be a representation from the Banks he^e.
T had p-.'omised to meet the Committee in Cincinnati
on Monday.

As you perhaps know, the attitude of the Toledo

Eanks is Cleveland first and Ci 'cin ati second. "



G-28

J.

J.

S u lliv a n
4553

That is signed by S. D. Car-, President of The
National Bank of Coramerce.
The Secretary of the Treasury:
MT. Sullivan:

Yes.

He appealed yesterday.

T have not learned whether he is

here.
The Secretary of the Treasury:

0, he appeared yesterday

in Cincinnati.
Hr. Sullivan:

*7ell, the Clearing House of Toledo adopted

a resolution stating these facts.
The Secretary of Agriculture:

That v^as his represen­

tation.
Hr. Sullivan:

Are there any questions you desire to ask?

T will be glad to answer them if I can.
The Secretary of the T-easury: These letters T/hich you
are
are offering as exhibits he3~e/expressions of Chambers of
Commcrve throughout the United States.

"fe should like to

know something about the manner in which these were procured,
"/ere they p-ocured as the result of solicitation or are
they voluntary?
Hr.

Sullivan:

Some of them are volu_;tary,

Ti'r.

and I think mostly invited.
The S e cre ta ry of



the Tre asu ry :

In what way?

Secretary,

G-29

J". J .

Mr. Sullivan:

S u lliv a n

4553

VTell, simply knowing the friendly relation­

ship -The Secretary of the Treasury:

T mean were the invi­

tations to these Chambers of Commerce to express 'themselves,
through committees sent out by Cleveland?
Mr. Sullivan:

!"o, sir.

The Secretary of the Treasury:

Or written represen­

tation of certain facts * and so forth, as an inducement
or what?
Hr. Sullivan:

We sent no committees out to solicit

support for Cleveland, and the letters which we wrote
inviting cooperation with us were -- we were actuated by
what we knew to be a friendly relationship existing with
banks and towns tributary to Cleveland.
The Secretary of the Treasury:

The only point the

Committee wants to establish is the basis upon which these
resolutions or the actions of these different Chambers were
made.

For instance, if :rou wrote letters making any par­

ticular representations about Cleveland as a reason why
they should take this action, we want those filed with the
resolutions so the record may be complete and we may be able
to better judge of the effect of the action.



In some

G-30

J.

Jc

4554

S u lliv a n

instances we found some '■representations were made as an
inducement for such expressions ■which v/ore not altogether
accurate.

;,Jow ’ve do not charge Cleveland with anything of

that kind or anybody else with making v-eprese:'tatio--s that
are not altogether accurate, but it enables us to judge
better of the value of these expressions.
Mr. Sullivan:

I know, and T am sure I am within the

bounds of absolute truth when T say the^e was no misrepre­
sentation made.
The Secretarjr of the Treasury:

nre do not suggest that.

7e only want to know v3iat was said,
I'ir. Sullivan:

ttt.

Baxter will take charge of that.

The Secretary of the Treasury:

This district

o. 5 as

you have laid it out with Cleveland as the centre, would
you say that that district at the period of maximum demand
is a borrowing or a lending district?
Mr. Sullivan:

At the period of maximum demand, as matter

of fact, we borrow but very little, and I speak more
especially of Cleveland.
The Secretary of the Treasury:

T am speaking now of the

district, its combined resources?
Mr.



S u l l iv a n :

T th in k that T can say t r u t h fu lly that

go.

J.

J.

S u lliv a n

4555

neith:-r Cincinnati nor Cleveland borrows much money.

About *

Pittsburgh and Detroit I would not feel privileged to make a
positive statement in that particular, Mr. Secretary.
The Secretary of the Treasury:

Tell, would it not be very

easy for you or your Committee, if you have not already as­
certained, to ascertained the amount of rediscounting done
by all of the National banks of this proposed district at
the period of extreme demand in any one y:ar?
Mr. Sullivan: r;e could do that, yes.
The Secretary of the Treasury:

Now you have not such

figure s?
Lr. Sullivan:

have not such figures.

The Sec-etary of the Treasury: Would you say that the
district was a borrowing district, #r that it always has
adequate resources to take care of the demand?
Lr. Sullivan:

Except at times of extreme stringency.

Ly

opinion is b-ised upon my experience of 25 years in con­
nection with this banking business, that the district is
able to take care of its people, in its borrowing.
The Secretary of the Treasury:

As a rule would it be a

borrowing or a lending district?
lr.



Su lliv a n :

It would be a le n d in g d i s t r i c t .

Pa

J . J , S u lliv a n

The Secretary of the Treasury:

4556

On the v/hole, you world

have a surplus of funds to l£nd?
Ir. Sullivan:

Yes, 1\T. Scretary.

The Seoretary of the Treasury:

L-:t us t^.ke some of these

other districts you have laid out here,
v

1 r. Sullivan:

:O’Id ”Ou pardon me one word?

I would

say this, that in Cleveland \:e scarcely ev:.r -ediscount•
The S:c -etary ol the Treasury:
Lrr. Sullivan:

I me.n directly.

The Secretary of the Treasury:
Ii". ^ulliv^n:

Yoi* mean directly?

Do you ever indirectly?

"Sc, vie bor^ov? money and put up our bills

receivable.
The Sec"etary of the ^re^sury:

Is not that rediscounting,

in effect?
j.:r. -ullivan:

^ell, not as it is understood in b.nkinr

circles.
The Secretary of the Treasury:

No, but I am talking about

the effect.
i.”. Sullivan:

^ell, the one is selling your paper direct,

endorsing it and selling it, and the other is aimply pledg­
ing it r„s collat?”al for a loan which is made on demand. 'e
consider it a better way than rediscounting when .ve borrow



ga

J.

on demand, and

J.

S u lliv a n

4557

e replenish our cash and .re can p.r* the

note on demand, hut the rediscounted p.per has to run until
the time fcr which it is drawn has expired.
The

of the Treasury:

But in either ease, 30 far

as the effect is concerned, it is a liability of the hank?
2£r. Sullivan: Oh, yes*
The Sec^eta^y of the Treasury:
effect;

And it is a rediscount in

in cthc- v:o~ds, you have got to go outside the re­

sources of yourown bank and get additional funds to carry
on your business?
I.r. Sullivoji: Yes.
The Secretary of the Treasury:

To what extent is that cus­

tom practiced in this district or in this -ity?
k'r. Sullivan:

Very slightly.

It is very seldom this

"ity borrow8 much money.
The Secretary of the Treasury:

Tv£n in the manner you

have described?
Z'r. Sullivan:

Yes, sir.

The SecT%:ta"r of :kt. T-c .-.svry: At the period of extreme
demand, "oloncl Sullivan, is it your practice he~e to stop
lending money ??hen yo” ret dov.n to vov.r reserves, or no
matt?" how legitimate the business is '-hich ought to be



£a

J.

J.

S u lliv a n

4558

cared for, or do you in such circumstances rediscount or
borrow money to take care of the business?
fcr. Sullivan:

T?e borrow money to take c .re of our business.

The Secretary of the Treasury:

!^ow it is important for

this Committee to get an idea of the extent of such borrow­
ing and get s02.16 idea cf it . Co'ld you not supply these
figures later?
lr
.r. Sullivan:

For the district?

-h« Secretary of .he Treasury:
Lr. Sullivan:

Yes.

Yes.

The Secretary of the Treasury:

As well as for Cleveland

itself?
1_r. Sullivan: S7<= can do tha',.

The secretary of Agriculture:

Say by the fi~st of larch?

i-r. Sullivan: Y?s, we will have to send a man to the dif­
ferent cities in ord^r to get it accurately.

Any figure we

-submit here we know is accurate.
The Secsstarycf

hr ^'easury:

Of course the direct redis­

counting appears in the reports of the National banks to
the Comptroller of the Currency, and that you can easily
obtain by consulting the records, but as to that indirect rediscounting-- we call it indirect because it is indirect-


ga

J.

J,

S u lliv a n

we she- Id like to get information.

4359

And ?;e sho Id also like

it as far as it is practicable to pet it, from the State
banks throughout the district.

Those, I suppose, corld be

obt-ined through the State Banking Department, could thej’
not?
lir. Sulliv,~n: T/e "ill be glad to furnish all of that.
The Secretary of the Treasury: Till ycu supply that?
Jr. Sullivan:

Yes, we will be glad to do it.

The Secretary of the Treasury:

For what period cf the

year would ’-ou say th-t this is a lending district, that is,
that it is

in possession of a surplus of funds that could

be employed elsewhere?
Lr. Sullivan:

'-ell, I would say three fourths of the

tiine .
The Secretary of the Treasury:
Lr. Sullivan:

Three fourths?

At any rate.

The '^creta'-y of the Treasury:

And fo~ about three months

you would say it was a borrowing district?
Mr. Sullivan:

Tell, not exactly, because at any time out­

side of panic periods, the Cleveland banks do not borrow
much money.
The S e c r e ta ry of the T re a su ry :



For three months of the

£"a

J . 0 .S u lliv a n

4560

year you v/c Id say that it was not a lending district?
Lr. Sulliv«.n: Ucll, no, in sc far as taking, c .re of the
j

„ „

dcu -nds of leveland industri;?, it is a

lender

• district;

v;e neve" shut down -The secretary of the Treasury:

No, what I mean is, rou

would not have a surplus nf funds for th~ee i:.ofiths of the
year t<-> lend ;.o ether districts, yov wo- Id need it within
your own district, is that what you mean?
Ir~. Sullivan:

That is what I Kean, yes.

The Secretary of che Treasury:

Let us consider some of

the other districts that -rr laid out he-e.
district Ko. 4 emb-acing 1 Hyland,
’o-'th and ^ovth Carolina.

Take this

'est Virginia, Virginia,

Hiat did -ou think of th-.t .-.s a

bor-owing or lending district, which world -ou say that it
Was?
-•

-11-van :

I

c

Id ?a" that was a borrowing district.

The ^c -na-y of the Treasury:

And TJc. 6, including Een-

tvek- , Tennessee, Georgia, riorida, Alaba-a and iississippi?
• Sullivan:

Jecidecly a borrowing district.

The Secretary of the T-easu-’: And

what

world

you

say of

lV°. 8* -issor.n, Arkansas, Lcrisiana, TZansas, Nebraska ;.nd
nolo"..dc?



£a

J.

.r. Sullivan:

J.

S u lliv a n

45C1

Thut would te a borrowing district.

The Secretary of the Treasury:

/aid Nc. 9, Oklahoma, T':w

1exico and Texas?
r.r. Sullivan:

It would be a borrowing district.

The Secretary of the T-erisu^;

How about No. 10, :innes-

ota, \c-’th Dakota and South Dakota, Wyoming, iontana, Id iho
and Washington?
L . Sullivan:

Minnesota would be a bo^"o:inp state, but

as to the -equirenent s: of Lontana -nd Washington, I world
not be p-epared tc express an opinion, Kr. Sec-eta-y.
The Secretary of the Treasury:

Nc-th and South Dakota,

Wyoming and Idaho, I see all of those included there.
'r. Sullivan:

In the c-cp moving period I take it they

Would be pretty heavy borrowers.
The Secretary of the T-easu-y:

Nov/ t Jce'Ko. 11, comprising

Ortron, ^ 1 _fcrnia, Nevada, Utah and Arizona, would -ou
call that a borrowing or a lending district?
;l~r. Sullivan:

I would call that a bo-^owinp district.

The Secreta-y of the Treasury:

No. 7, which includes

Wisconsin, Iowa, Illinois, Indiana and a pa-t of Iichigan,
what would you say about that? The Chicago dist-ic-:, -world
you call tha. a bo^ro ing o- A lending district?



J.

Fr. Sullivan:

J.

S u lliv a n

4562

I would not consider that a borrowing dis­

trict .
The Secretary of the Treasury: You think that wo- id always
have surplus funds available for lending to other districts?
I1". Rullivanj

I :hink so, 3V'r. Secretary.

Ths Sec'eta~y of the Treasury:

And Nc. 3, a part of

Pennsylvania and Delaware and payt of *7sv/ J-~s ry, ~cu would
consider th.it a3 a lending district?
l.r. Sullivan:

As a lending district, yes, sir*

The Seer, ta^y of the Treasury:

And No. 2, How York ^it-,

of course, is a lending district?
IL" . Sul1ivan: Yes.

The Secretary

oi

.he

T

-easury:

And

He.

1

is a

lending

district?

lr. Sullivan:

Boston, yes.

The Secretary of the Treasury:

You include in'that the

larger part of N,-« Yc^k State in area, and the New Pngland
Stages excl- sive of the 'est:-n half of Connecticut?
Fr. Sullivan:

Yes.

The Sec~eta-*~- of he Treasury:

That would be a lending

district?
i '.



Su lliv a n :

Yes,

that would be a lending district .

ga

J.

The

Secretary

Sullivan,
ately

tim es

year

of t h e y e a r ,

serve

The- S e c r e t a r y
fundam ental
a question
Mr.

into

d istricts

of t r a n s p o r ta tio n ,

another

Mr.

ought to be

so c l o s e ­

p a r t s o f th e

but

district

readily.

But d o e s t h a t mean the
Com m ittee? I t

i s not

of r e s o u r c e s .
one d i s t r i c t

I th ink

co'-ld,

u nd er

t h a t w o u l d meet

that

Sec^eta^y.

com pel

P ut

is

that

sufficient?

t h e r e d e r a l R e s e r v e B o a r d may per.nit
to a n o t h e " ,

one R e s e r v e B a n k to

obvious purpose

of t h e

d i s t r ic t s w hich w i l l
all

of the

and tr a n s p o r t a t io n f a c i l i ­

but u d the
district,

la w p r o v i d e s t h a t

dependent



the

S e c r e ta ry of the T r e a s u r y :

cum stances

d i s t r i c t s most

o f t h i s p rob lem ?

of th e T r e a s u r y :

one P e s e r v e E a n k to l e n d

the

cr d e p e n d e n t

facilities

ves,

should d e l i b e r ­

d i s t r i c t s w h i c h com prise

d i f f i c u l t y w hich meets t h i s

aid

objection,

Committee

num ber o f b o r r o w i n g d i s t r i c t s

the d iffe r e n t

Sullivan:

th e l a w ,

The

I think

that m ail

t i e s would

into

4563

As a f u n d a m e n t a l , C o lo n e l

this

su ch a l a r g e

Sullivan:

related

The

off

As a fundam ental

M r.
ly

th at

country

w h i c h c o m p rise

S u lliv a n

T r e a s u r ::

do y o u t h i n k

lay th is

at a l l

of th e

J.

the t im e .

law

i t may

le n d

in

some

to a n o t h e r ,

cir­
but

i s to h a v e a c o u n t r y l a i d

not b e ,
In

an d

unless

other w o r d s ,

necessary,
i f y o u h av e

out

wholly
a lend­

ga

J.

J.

S u lliv a n

4564

ing district, as you have described you~s to

be,

and you

have a surplus of funds which you want to lend somewherea,
and you have no borrowing end in the district, then you
have to go to the Federal Reserve Board and .sk fo" permissi
to lend those surplus funds to another district;

or if

you do not want to lend then, and some one wants to get them
from you, they have to go to the pedertil peserve Beard „nd gc
get an order to compel you to lend them.

Now is it wise

to create a situation of chat char ,cte-~ deliberately from
the outset?
1'r. Sullivan:

If it could be -eadily ind intelligently

avoided, I think it would be well to avoid it primarily.
The Sec^etar?- of the Treasury: Fxactlv*
1'r. Sullivan : Ye s.
The Sec"eta"y of the T”easu^’: Now, the^efo^e, is it not
the obvious duty of this Comuittee to divide the count”y
into such districts, so far -.s practicable, as will coin*
bine both a lending and a borrowing end, so that you can
get that sort of financial equipoise in each district which
world enable you, if this were a pa^t of such a district,
for instance, to lend your surplu s funds within the district
when they were needed at one end, and therefore be able to



J . .T. S u lliv a n

4565

employ those funds equitably and actively throughout the ’-ea
Vro id not that be the wiser plan?
Hr. Sullivan:

If it could be done without violating

the course of trade and convenience and accessibility find
all that sort of thing, I think yes, if it covld be done.
The Secretary of the Treasury: How under the plan you
have l.id out here, with all of these dependent districts,
they would be constantly at Washington fo^ their permis­
sion to borrow somewhere else, or to compel some other dis­
trict to come to their -elief, with the eleven districts
v/O'-’
- have laid them out, with the num1 £~* of dependent
districts which you have stated?
1~. Sullivan:

Yes.

The bo^-owing demand in any of those

districts is not perpetual, as I unde^standit, h". Sec~etary.
The Secretary of the Treasury:
that?

That i-s the point.

A^e you f.-ani11 .r with

Ycu cannot lay this country

out into di st"ict s without having due 'ega^d to the probleas presented by each one.

*?cw the ~eal problem here

is not the location of the Pederai Reserve Sank in some city,
** 7
but it is to divide this country into proper districts. How,
once -cv have that, the location of the Federal Reserve Bank



-

J»

J . Su lliv an

4566

in the district is comparatively a simple problem, so that
we must all address ourselves primarily to this most import­
ant phase of the problem, the division of the country itself
into districts.
L'r. Sullivan:

If the district could be so arranged, such

as we were compelled in our office to arrange for the Min­
neapolis district, rUnninf 0ut and taking in Washington, if
it covld be avoided, I think it -ovld not be best to arrange
a dist-ict with such g-eat distances, where it would take
from 36 to 48 hours to get mail from one end to the other.
The Secretary of the Treasury:

Lay I ask if in sugresting

these districts, the transportation facilities and other
factors which necessarily enter into

it, were considered by

your Committee?
lfr.

Sullivan:

Yes, sir.

The Sec"eta"y of the ""-easury: 0- did you simpl” lay the
country off into districts, consulting merely the financial
resources and so fo-th of these districts, so as to give
b:.nk the necessarily capital fixed under the Act?
i-r. Sullivan:

The Executive Committee deliberately and

religiously and with all the intelligence of which we were
possessed, took into consideration the financial resources and



Pa

J.

J.

S u l l iv a n

45C7

the industries of every state and every district which we
have ar ~anp ed on the map there,

^e pvt in hours and hours,

and had many, many meetings, and this was the result of
ma.xu.re and long continued deliberation, I'r. Secretary.
The Sec-eta-y of the Treasury: TTow corainp back to the main
point, the convenience and customary corpse of business. The
district ~„s you have o "clined it here
1 ichigan.

?n1 races

a part- of

>?ow is the customary course of business from this

part of Michigan included in -our district with Cleveland?
T~e will take the "ity of Detroit, for instance cilone ; is its
bi Biness no"e with Cleveland or rith Chicago?
Jr. Sullivan:

1o'e with Chi oagb, I". pgc ’et^y;

but it

is only four hov-s or four and one half hours from Detroit
here by rail.
The
hand,

~?c -eta-’y

of

the

? .’ £ i s v r :

if

th-

cuscom ary course

Chicago,

th e

1 ..; r e q u ir e s us

fr .c L .

The m a n d a t o r y

• i.”. Sullivan:

* Xr.cs l y .

of
to

p ro visio n

its
give

of

;h e

Put

business

is

on the
w ith

consideration

1

„w

other

requires

to

that

t h ..t .

Yes«:

The ^ec-eta'T of the Treasury:
us take Puffalo, 'New York.

t'Tow on the other hand, let

*hat would be the fiusto..'ary

course of Buffalo's business, is it with Cleveland or with



ga

J.

J,

S u lliv a n

45 08

New York?
Ur. Sullivan : Eastward •
The Secretary of the Treasury:
3 *’. Sullivan:
The

^ £ C ''e ta ” y

And Rochester the ame?

Rochester the same.
of

the

Treasury:

Hoy:

../bout Pittsburgh, is the

custo.if.ry course of "business with Cleveland or with seine
other points?
L'r. Sullivan:

V'e do a very 1 ,.~ge volume of "business with

Pittsburgh, yet the trend of exchanges on the part of "Pitts­
burgh is towards !?ew York.
The Secretary of the Treasury:

Eow about Cincinnati,

the customary ccv^se of Cincinnati1 s business is -;here?
:r. Sullivan:

'ell, under conditions .s they have existed

fcr years, ’Tew York -The Secretary of the T ’easur-;

I am not speakinr so .uoh

cf banking exchanges, because I know those h .ve been very
largely .rtificial under the old system.
l'r. Sullivan;

Yes.

The Secretary of the Treasury:

Eut I am spe-king of the

business its l'f, the distribution of comr.odities l>oxa these
different cente-s.
ly be?



'here wovld Cincinnati’s tr.de principal­

ga

J.

rr.

Sullivan:

he r a t h e r
The

I think

J.

that

SulliVein

the t r a d e

°ec--rtary o f the

Treasury:

of b u s i n e s s ,

n o t bs

c o n s e r v e d b y a t t .o h i n g it

•

i t T70-. I d
Sic

I

hile

not b e

in

>.ta y o f the

of b a n k c l e a r a n c e s ,
see by the

So t h a t

sc f , r a s C i n c i n n a t i

:u l l _ v u .n :

The

o f C i n c i n n a t i ■.■eld

southward.

course

that

4569

the
is

cone r n e d ,

c o n s r ’v s d ,

Treasury:

C o m p t r o l l e r 's

You made a c o m p a r is o n here

an d C l e v e l a n d

statem ent

of

an d P i t t s b u r g h .

October 21s

of o t h e r N a t i o n a l b a n k s ,

and

rou n d n u m b e r s ,

banks

savings banks
excess

er N a t i o n a l
her

in

TThat

Sullivan:

The S e c r e t a r y
~r.



The

agr-erate

-e se-ve h o l d i n r s .

Sullivan:

to

State

c om p an ies
of , h a t

in

C i n c i n n a t i h-s l a r g ­
but yoy exceed

out by C l e v e l a n d banks

inte- est?

T " eaau>w. .

yes.

1-2

ccnt

T e pay 2

is

and

such b a l a n c e s ?

On the m a t t e r o f
of th e

"1 2 ,3 6 6 ,0 0 0 ,

and p r i v a t e b a n k s an d f u s t

i n d u c e m e n t s a re h e l d
fo^

that

fo r ^atet banks

b a n k -€s e r v e s t h a n y o u h av e h e r e ,

correspondent banks
Mr.

and

and f o r t r u s t

1 4 ,6 5 1 ,0 0 0 .

the amount due

com panies.
to

1 0 ,2 4 3 ,0 0 0 ,

of C i n c i n n a t i 's

:e i o e l

.ny way i n j u r e d .

you h e ld as r e s e r v e s

and p r iv a t e

••;c i d

to C l e v e l a n d ?

i t vrovld not be

Cincinnati

I -..-ill o n l y r i v e

custom ary

;;er

on d a i l y b a l a n c e s

in

£a

j . J . S u lliv a n

Cleveland.

That

i s the

The - c-'eta-rof the

-1570

renewal n i l e .

? r C-asury:

Is

th at

a C l e ^ r i n r Hcvse

rule?
I,". S u lliv a n :
a d h e r e d to

quite

The s e c r e t a r y
-

s u H : l Va,n ;

''e l l ,

it

i s a h a r d and fa s t

” Ul e

th at

is

closely.
of th e T r e a s u r y :

All

the b a n k s pay t h e

A l s o t h e y are p r i v i l e g e d

t h e r e i s no a b s o l u t e

"eq u i"e m e n t

"hat

to pay more

same?

or l e e s ,

t h e y must a d h e r e to the

2 1-2 p e r c e n t .
The

S e c r e t a r y o f the

2 1-2 p er

Treasury:

The p r a c t i c e

t o pay

is

cent?

.

Sullivan:

The

secretary

Ur.

Sullivan:

The

secretary

That

is

the g e n e r a l

of the T r e a s u r y ;
I do not knew
°f

practice.

Lo a n y

o f them p a y mc-e?

cf any.

th e T - e a s u r ' :

How a bo ut

free

check c o l­

lections?
xr .

--villi v a n :

That

is a n a t t e r

th at

each bank determ ines

rhat

i s th e p r a c t i c e ?

for it s e lf.
The

S e c r e t a r y o f the

Treasury:

Lr.

Sullivan:

spe^-k s p e c i f i c a l l y

th e
in

co u rs e
th e




that

Cit” ;

it

I

can

pursue
depends

is

a bo ut

—

w ell,

th e g e n e r a l

somewhat u p o n the

I think,

course pursued

character

of the

£a

J,

J.

Su lliv an

dccount which is kept with us.

4571

If a. good bailee is kept

without interest, we make collections at pa-, uo-^e especial­
ly

il »e

c-.n pet then: at par.

Put the collection of chocks

on points remote from Cleveland, that cost us to Collect, we
usually m.ke a charge for it, if the account does not wa— ar
us standing that expense ourselves.

It is a matter of indi­

vidual opinion, I take it.
The Secreta -y of the .T-easury:

Is the effect of the pen-

e-al practice as you have described it, to make check col­
lections largely free?
if”. Sullivan:

'Jot when they cost the bank.

The Secretary of the — easury: No, but I am speaking of
the general effect produced upon the whole volume of col­
lections.
i- . °-ullj.van: I think that we ."e quite oblinping with
O',r customers in that, '’epard.
The Secretary of the Treasury:

-hat would you say was the

per cent of disobligingness, in other words what percent­
age of ,he total collections would you say are paid for?




■ * ^'--llivan:

Tell,

I would

sa y not

The r?ec~,eta1,y oi the T^easur':
L”. Sullivan:

ev er

one

quarter*

25 per ~ent?

Yes, si".

The secrets-- of the T-easury:

Sp-.^that about 75 per cent

J.

of

the

c o l l e c t i o n s arc

ir,

- H ivan;

free,

Yea,
if

f-om my ovn e x p e r i e n c e ,
d o ing it

Su lliv an

w ithout

Am I r i g h t

g e n t l e m e n c o r r e c t me

the:* a re

J.

I

4372
ch a rg e?

in t h a t ,

wr0ng.

g en tlem en ?

I am s p e a k i n g l a r g e l y

a n d th e g e n t l e m e n who are

otherw ise,

it

is

You

here,

t h e ir prerogative

if

to spr=J

up .
The

s e c r e t a r y ol

accurate
in

the
I r.

inform ation

the

Treasury;

on th at

record as an e x h i b i t
Sullivan:

The S e c r e t a r y
*

;hc

.

Yov

p oint,
to " O u r

C o*-ld f u r n i s h us

could you not,

to be put

testim ony la te r ?

Yes.
o f the

.'i i l l i v a n :

Treasury;

I an w illin g

c h e c k s w h i c h cost

u s to

J u s t m-Jce a n o t e of
to go

collect,

on r e c o r d

we

as

c h a rg e to

it.

s a y i n g that

Ou r cus-

to;._er o
The Secretary of the Treasury;

I want •.o fix a little

more accurately, the extent to which you are obliging.
i--. sull.,./an: 1 ell, that is a le iding chc." »cteristic of
the Cleveland bankers, jr. Sscrrtarv,
The Secretly of the T-casury:

Put you wovld sav the

oh^.otc-iati<! deee not exceed 75 pe- oent. vm
us with some data on th ,t, Colonel?
rr. Sullivan;



I wo- id be gl .d to.

„ou furnish

J.

J".

Sullivan

The Secretary of the Treasury;

4573

That cc: Id he sent as a

Clearing House mutter,
fcr. Sullivan:

Yes.

The Secretary cf the Treasury:

It h .s a hearing upon some

features of the question, and we have -.sked it at other
placcs, and \.e should like it here.
Lr. Sullivan:

There are representatives cf ths larger

canks right here, and _f they have any views differing frcm
ryy own, c~ if an*- custom

ha3

obtained in their bcnk diffe-ent

f-orn what I h,.ve stated, I wc-Ld. like to hear from them,
.the Secretary of the T 'eusurj': Veil, they can submit such
information .-.s they desire later or not, if they desire.
—r• Sullivan: L"» She'-’Win, what v.’ould you say?
I". John Sherwin:

(President virst National Panic): I

think "'e could be called fairly liberal.

I think \;e are

abort the same as "incinnciti, not .s liberal as Pittsburgh,
and not r*s literal as Philadelphia.
The Secretary of the Treasury:

Or as Albany?

Lr. She^in:

No, v/e are not .s liberal aa Alban-, nearly.

I". Sullivan:

I wold say there is a ve^y strong rivalry

there, as there is in nearly every civ , between the banks,
and the banks have to cater not only to the business, but the




•^

J . J . Su lliv an

4574

whims of the patrons of -she bank, in o-der to hold their trad
The "ecreta^j- of the Treasury: 'ell, under this system,
with the abolition of reservation, I mean tho exa.ing re­
servation, naturally ’-ou will not have tfee saiue ~ivalry -the s jje occasion for rivalry in that ~egard?
Sullivan:

No.

The Secretary of the Treasury:

Ve

had in Cincinnati yester­

day a district suggested embracing Ohio, Indiana, Kentucky
and Tennessee, with sugrestions that that district might be
extended even tc the Gulf, including in any

Cr.se

the State

of Alabama. That would you say as to such a district ae
that, the main feature being the inclusion of a lending with
a bo'-rowing district, and -.Iso getting a dist”iCt of great
dive^silicat icn of industries -and crop rotations and of
financial rotation, so to speak.

Hew would you view

such a district as that?
Lr. Sullivan: r-e certainly cc Id not look upon it with
favor, I!:-. Secretary.

in Cleveland ;specially, the iron

and stt-el are g-eat f .ctors with us. Te have business -ela­
tion s with Pittsburgh many, many times over, more than re
have with Cincinnati, owing to the fact that the iron ore
produced and brought down 1"0m Lake Superior bv our people



ia sold to ‘
Pittsburgh furnaces -ThG 5eor«a-y of the T-csur:

Of course you realize

that the c-eation cf that district wo- Id not affect in the
slightest degree those transactions with Pittsburgh.
Lr. Sullivan: Tell, we think that it would sv.it better
to have the bank located in Cleveland, owing to our being
in the center of this unusually active-The Secretary of ihe T-easur-;
the district.

Ko, I am spe Jcing cf

The district I have just described wovld in-

d de *^e State of Ohio and the

Cif of Cleveland. Suppose

Cleveland h-.d the Reserve Bank.
The Secretary of Agriculture:

And omitting any consider­

ation of where the bank should be located,
L". Sullivan:

The district would be too much discon­

nected, it seems to me.
The Secretary of the Treasuryt Fell, the transportation
facilities throughout that district are north and south.
The Secretary of Agriculture: Pot Id it be an;- more dis­
connected than the district including L'innesota and ’",-shinpton?
L~. Sullivan:

As I said a while ago, ir. Secretary, that

is the only district that we do not altogether approve ol,



€a

J.

J,

S u lliv a n

4576

tut we co Id not arrange the map any tetter, ’"e do not al­
together approve of that, you might say, sheeting district,
and the district which you name would trike on a similar form,
it seems to me.
The secretary of the Treasury:

It would give you a diver­

sification and rotation cf the financial demand throughout
the year, would it not?
t " . Sullivan:

Well, I do not think that I could reason my­

self into a conclusion that that would te the test kind of

a district fo~ Ohio.
The Secretary of the Treasury: How are you going to get
a borrowing end unless you take in some torrowing territory
with a lending te^ntor,’-?
&r. Sullivan:

Vc

really h.,ve our active industries he re,

which as I said tefo^e, ~equi ’e all of the money -,:e h.we
in Cleveland.
The Secretary of the T-casur;:

No, I am spewing of the

district, ^e cannot consider Cleveland .lone as the whole
district;

we have to figure on che whole district.

1‘r. Sullivan:

No;

while it is ve"-* close tc our heart,

yet /e -ealize we are citizens of a. great country
Trie Secretary of the Treasury :



You h .v e 1 .id out a dis-

J.

J.

Su lliv an

4577

trict here in which you say for th~ee quarters of the year
you have a surplus to lend, and you have no territory under
this pl^n in which to lend it unless you can get the per­
mission of the Federal Reserve Board in Washington.

New

you do not want to be put in a position of that kind, I
assume, because after all, this Reserve Bc.nk must b
constituted upon the s.une common sense grounds that you
wo Id constitute any other banking institution or business
organization; so we must lay it out with logical reference
to some known or conceivable common sense business operation.
Nov/, if the .Federal Reserve Board, for instance, should s:-*y
to you that for nine months in the ye.r you could have
l.nt ycur funds out of that district, what would become of
your Reserve Bank, where rov.ld you earn interest on its
3tock?
I.", ^ullivan:

Ir. Secretary, I wo- id not wish that it

wo-ld be inferred from what I have said about having money
to lend, that we sought paper ottside of ot r cits'-. I h .d
reference to the money to lend 10 our loc;.l people.
The sec 'etary of the T'*easu~y: And I was speaking of the
district . I asked if the district «s suggested by you was
a borrowing or a lending district.



Now you show that for

three months cf the yeur it is a ‘
borrowing district, or if
not a borrow ing district, all its resources are required
within the district,
Hr. Sullivan: V'ithin the district, yes.
The secretary of the Treasury:

/aid for nine months there

is a surplus of funds within the district that may be used
somewhere else.
lr. Sullivan:

That is the point I desire to correct. I di

not mean to say we had a surplus of funds which were not in
dc iaand here in this district.
The Secretary of the Treasury:

Por the whole year then

you would consider the funds world be fully employed in
this district!?
lr. Sullivan:

Yes.

In Cleveland it is a fact that rare­

ly ever do we go out and buy paper on the market.

Our in­

dustries are so numerous and their requirements are so
great, that all the money

e have in Cleveland is in demand

here.
The Secretary of the Treasury:

Bow it ought to be per­

fectly simple to furnish some real figures.

If you gentle­

men have studied this problem as much as you say you have,
it ought to be possible to furnish some figures about this



ga

J". J .

S u lliv a n

4579

district which would shov: whether or not it is a lending cr
harrowing district all cr part of the year, and what parts
of the year it is such*

Can you not give us chose facts?

I should think your Clearing House Committee could give us
some real data on that point.
Hr. Sullivan:

7/hen I say a lending district, I mean we

have ample money to supply the local demand.
The Secretary of the Treasury:

Yes, tut what we need to

knew is how much more than the supply fcr the purely local
demand you have at any period of the year, and what length
of time cf the year you have that surplus of funds in this
district, and if you have an inadequacy of funds for any
period of the year, what period of the year,, and the length
of its duration, and tc what extent.
lfr. Sullivan:

As we say in our brief, ae believe that

cur district is quite well balanced up.
The Secretary of the Treasury: Veil, we cannot proceedcn
beliefs;

we must proceed on facts. How, these facts are

obtainable, and we should like very much to have those
facts. They are very essential f-.-.ctS, and if you gentlemen
addre S3
will
yourselves to that question, we will give you
time to file a brief which will cover that particular point



-

J.

J.

Su llivan

4580

I assume you could furnish it by the first of Larch, could
you not?
Lr. Sullivan:

Oh, yes, Lr. Secretary.

ihe Secretary of the Treasury: I will ^sk the reporter
to give you a copy cf these questions, so that you cuy have
them.
Lr. Sullivan:

Very well.

The Secretary of the Treasury:

Is it the view of your

Committee, after careful study of this question, that the.
co ntry should be divided into 1 1 districts?
L-. Sullivan:

That is our conclusion.

The Secretary ol the Treasury:
Lr. Sullivan:

That is your best judgment*

yes, in order to carry out the spirit cf

the law.
The Secretary of the Treasury:

Do you think it is the

spirit of the law to c^eatc a let cfdependent districts, as
I said before, if you can avoid it?
Lr. Hullivan:

"No, if it can b;? avoided;

The Secretary of the Treasury:

no.

Are you more likely to

avoid creating dependent districts with a less number or a
large number?




kr. Sullivan:

I beg pardon?

r

J.

J.

Su lliv an

The Secretary of the Treasury:

4581

I say, ^re you more likely

to create a number cf dependent districts by dividing the
country into eleven districts than into eight districts?
Hr. Sullivan:

The eight districts would be, it seems to

me, more self-reliant.
The Secretary of the T-easury:

You would have stronger

unit s?
i.r. Sullivan:

Yes.

But in carrying out the purpose of

the law, we have been governed by the idea that TJew York and
Chicago should be detracted frrm and minimised in a way from
what they have been in the past*
The Secretary of the Treasury: You do not attach import­
ance to. the suggestion that a great and dominant bank should
be cheated in ??ew York, do you?
Lr. Sullivan: r'ell, I think that r’ew York should natur­
ally have a larger bank than any other district in the
country.
The Secretary of the Treasury:

But ”0v. do net believe m

creating a dominant bank there, one that had for instance,
forty to fifty per cent of the entire banking capital and
resources of the country?
¥.v. Sullivan:



No, I certainly world not approve cf that *

g <•-

J.

J.

Su lliv an

4582

Ths secretary of the Treasury: There do the Cleveland
tanks keep their reserves now?
1>. Sullivan: rear York, Shicago and St. Lov.is.
The secretary of the Treasury:

And in vzhat proportions,

would you say?
I'", Sullivan:

Probably 50 or 60 per cent in ‘
,Tew Yon: and

3C per cent in Ohifiago, and about 10 pe” rent in St. Louis,
The ^ec-eta-y of the Treasury: Thy is the la-ger bailee
kept in r'ew Yc^k, is that because

the course of your busi­

ness and exch ;nge is rao^e that way than any way else?
i:r. Sullivan:

Yes, sir, 2 r. Secretary, and also due to

the f^ct that the ’’ew York exchange has become so popular
that a man going west or east anywhere, if he gets'a 'lew
Ycr,: draft, feels perfectly safe that he can have it cashed
anywhere.
The Secretary of the T-easury:

rrith the parking of ex­

change between these Reserve Banks, as provided in the Act,
do you think it would be necessary to n.aintain such large
exch .nge balances in "New York "ity?
JJr. Sullivan: *?0, I do net, and in fact we could not, o;ving to the smaller-The Secretary of the Treasury:



You could not carry re­

serves, but ; ou wo;ld carry some balances there in addition

E&

J.

J.

S u lliv a n

serves, tut you carry seme talcinces there

4583

in addition to

your reserves, do vov net?
1'r. Sullivan:

Yes, and that we Id dcuttleas te done tc

some extent.
The Sec"*eta"y of the Treasury:

Bui, not to sc la"ge an ex­

tent as now?
L1'. Sullivan:

!\’o, it wot Id not te necessary.

The Secretary of .he T’-easury: ”ow, assuming the crea­
tion of r„he district as you have c tlined it he”e, what
would te your second chcice cf a city?
L". Sullivan:
lr.

Tell, really we h-.ve not considered that,

Secretary.
%

The sec-eta"y of the Treasury:

It is <_ very necessary

consideration.
Er

. Sullivan:

The governing thought was tc present

our c .se to you gentlemen and with your l-.rge and varied
experience, gleaned from examining the whole count
The Secretary of the '’-easur'; You know this district
tetter than we do, and if Cleveland did not have it, what
point wculd you say would next test serve it for the loca­
tion cf a reserve tank?




Ur.

S u l l iv a n :

P erso n ally I would not f e e l like

expressing

e

J.

J.

a second choice. (Laughter).

Su lliv an

4584

rje believe that you gentlemen

v-ith all of the facts in ycur possession, -.Till discharge -our
duty as your duty occurs to you.
The Secretary of the Treasury: Yle \7ant you to help us dis­
charge it by giving us as full information as possible. Now
you think Cleveland is the best point for this location.
Lr. Sullivan:

Decidedly so.

The Secreta'-y of the Treasury: Ycu have convinced me that
you think so.
Lr~. Sullivan:

I have very strong views on that subject.

The Secretary of the Treasury:
give us in order to

Now what we want you to

aid us is your best judgment as to
cc'-.id

\7hat other city or cities next to Cleveland/best serve
this district if Cleveland covld not have it.
r.aterial question, and

It is a very

ask it everywhere, ;nd usually we

get, of course, the information.

If you co- Id not have

Cleveland, then you must think of some other point that,
with your knowledge cf the district, would be the next best
place it could be put to advantage.
ITr. Sullivan:

State pride, 37-ou know, wor.ld suggest the

1 o,




The Secretary of the Treasury;

D isre g a r d in g State pride

J.

J.

Su lliv an

4585

and considering the "business and economic phr.ses of the
problem.
1 ". Sullivan:
j.s

I think the concensus of opinion j and this

my own think, because «/e have had no conference or

exchange of vie^rs -The Secretary of the ~"easury:

I .-an asking for an ex­

pression of individual opinion*
L^. Sullivan:

I think that Chicago would probably be

out next choice,
The Secretary of the Treasury: Put that is not in the
district.
L.r. Sullivan:

I beg pardon.

The Secretary of the Treasury:
trict ycu have laid out he-'e.




I a.i speakinr cf the dis­

ga E x2

Mr.

S u lliv a n .
45 8%

Mr.

Sullivan:

"'ell, if

I

have to express a second

choice, personally I wculd then say Cincinnati,
T:.e Secretary*- of the Treasury;
third choice?
onel;

And what .vould be your

This may be taxing your magninamity, Col~

would it be Buffalo or Pittsburgh, cr either of them,

cr Columbus?
Mr. Sullivan:

Tell, we do not feel that Buffalo is con-

sidered at all in the matter.
The Secretary Of the Treasury?
Mr, Sullivan:

It is in the district.

Yes, but owing to the business relations

’tfhick ~e have ~ith Pittsburgh, I think I would make Pitts­
burgh as the third choice.
The Secretary of the Treasury:

.X
That would be your third

choice?
Mr. Sullivan:

Yes.

The Secretary cf .Agriculture:

Chicago rould be your se­

cond choice, if you ^ere simply considering cities and not
this district?
Mr. Sullivan:

Yes, but that would be so unreasonable, to

attach this part of the country to Chicago, that it would
be violating, you might say, the spirit of your law.
The Secretary of Agriculture:

On the same principle would

it be unreasonable to attach Buffalo to Cleveland?




1'r . S u l l iv a n
4587

Lr,

S u lliv a n :

No,

The Secretary of Agriculture;
Hr. Sullivan:

Nor Pittsburgh?

No, ]£r. Secretary0

The Secretary of Agriculture.

Eov would it be more un­

reasonable to attach Cleveland to Chicago than Buffalo to
Cleveland?
Lr. Sullivan:

O..ing to the fact that it would make Chicago

a much stronger district than the lav; contemplates.

That is

•tne point i
The Secretary of Agriculture:

I see<. I thought perhaps

you had in mind the drift of your trade
1'r. Sullivan:

Oh, no.

Ho, we are at peace with all

our neighbors, and we are ready to adjust ourselves to any
condition which you gentlemen place upon us, in order to make
the lav; work.
The Secretary of the Treasury:

You mean you are at peace

even on the Reserve Bank proposition, even including that?
I'r. Sullivan:

Oh, yes, yes.

The Secretary of the Treasury:

The Pederal Reserve Act

ir

Section 13, page 14 of the Act, provides among other things,
the following:




"Upon the indorsement of any of its member banks, wit

a waiver
Federal
of

of

demand,

reserve

exchange

tnat

is.

agricultural,

the

proceeds

the

Federal

count,

w ithin

net

and b il l s

industrial

Reserve

the

protest

of a c t u a l

of which have

There
shall

out

drafts

for

or d e f i n e

and

b a n k may d i s c o u n t

arising

notes,

notice

are

read.

some
Y ou

possible,

mercif.l

paper w i t h i n

have

any

peculiar

is

peculiar

it

and

and

tc

to what

by the

I

upon the

of t h is

;:e

should

s u b m it

question

Act.

full

so we may become

-.rain,

we

should

like

you to

t o us

How,

of
of

if
com­

com-

i f you

I mean p a p e r

like

in

pro­

of l a r c h ,

definition

out

suggest

the whole

and

15th

of paper h e r e ,

locality,

of

that which

for

question,

should be the

the meaning

and b i l l s

dis­

A ct."

it

drafts

for

Cleveland Clearing

character

this

determine

eligible

set

notes,




as

to

the

a memorandum or a b r i e f

paper,

right

t o ha v e

p r a c t i c a l mo me nt ,

mercial

such purposes,

Act

c o n s i d e r a t i o n 'to t h a t

earliest

or

the

Hcv.ae
the

or d ra w n

to

^e

at

like

issued

purposes,

attached to

vision.
give

should

of t h is

refer

the

for

and b i l l s

transactions;

exchange

paper thus

provisos

can

commercial

been u s e d ,

of the

the meaning

drafts,

or c o m m e r c i a l

B o a r d to have

character

notes,

of

4588
any

"by s u c h b a n k ,

you to

fam iliar

the

forms

that

describe
with
of

e x c h a n g e w h i c h y o u t h i n k v/ould

it;

ga*

Mr*

best

serve

i.ar.ks a n d
cf

their

Mr.

Sullivan:

The

Secretary

the

Act,

branches,

and

time

branches,
of

a

and

of

a

and

to

us

to

hew

also




that
a

in

this

fcr

is

great
here

provision

s u g g e s t i n g what

do t h a t .
Now,

16,

Section

page

19

B oard s h a l l make an d pr o m u lg a t e
g o v e r n in g the

transfer

reserve b a n k s

such F e d eral

each

bank

to

for

its

reserve

tc

funds

functions

banks,

o r may

functions,

the

funct­

member b a n k s . "

important

deal

of thought

in the

clearing

~e

t he

exercise

of

and t h e i r

exercise^ such

such bank

a very

region,

practicable.

discretion exercise

reserve

a memorandum o r
that

to

as

w ith a view

provisions:

its

c l e a r i n g house

experience

practice

glad

far

am^ng F e d e r a l

may a t
house

sc

Treasury:

two

require

requiring

yvur

be

regulations

a Federal

rcw
or.e

o f the

therefor

ma y a l s o

ions

forms,

I will

tine

clearing

designate

and tho member bank s.,

F e d e r a l Heserve

to

charges

those

contains

"The
from

4 58Q

f o r u n i v e r s a l use among t h e s e F e d e r a l R e se r v e

standardizing

of

Sr.llivan

should

feature
and

of

study,

this

Act,

and w i t h

of

checks

and ~ ith your

like

y o u to

submit

a b r i e f e x p r e s s i n g y o u r vie-rs as
o f the

A c t may

oe b e s t

y o u t h i n k *7ould b e

e'fiec tuatcd,

a reasonable

charge

Mr,

to

Vc m a d e b y t h e

their
come

branches,
along

at

the

Yes.

The

sec-stary

of the

of

10,

provision
m a y come

this

also
tc

par

in

re- i t t e d

a “ ederal

reserve
shall

be

bank

funds,




%/

another

preceding
better

the whole

"em itting

that,

read

this

question

receive

or f r o m f e d e r a l
cf

its

reserve

other

~ederal

to t h e

credit

or

as

for

P o t. r d

of

shall,

by

and

and when

drafts

reserve
said

in

s o l d to
rule,

me-iber b a n k s f r o m

con-

bank

collecting
its

fix

its

bank

depositor

a member

incurred

exchange

banks

Nothing herein

prohibiting

expense

on d e p o s i t

depositors,

in any

o r member b a n k .

b- t he

shall

checks

actual

Reserve

collected

bank

bank;

construed

.nd

be

T h a t mav

still

reserve

depositor

itB

to

reserve

>'ank u p o n f u n d s

Federal

is

I had

Bo t h a t

drawn upon any

from c h a r g in g

The

funds.

other.

There

perhaps

-ecord,

rede rc *l

drafts

by

cr aen^e**

of

you?

d~iwn b y any

t ained

the

the

>?0

b e t w e e n them a n d

paragraph just

"elates—

f r o m member b a n k s

checics a n d

said

Treasury:
the

banks

transfer

t im e w i t h

Act,

which

"3 v e r y

in

same

k

Reserve

g o v e r n in g the

Sullivan:

on p u r e

at

Pederai

1 'r .

provision

Sullivan

patrons,

the

charges

p a t r o n s whose

H r. Sullivan.
4591
checks

are

cleared

charge

w h i c h ma y b e

collection

of

you

the

Lir.

Sullivan:

The

Secretary

provides
in

the

that

of

bank

cf

that

shall

ani

as

you not
the

these
a

r;et

the T rea sury :

done,
of

views

also

to h a v e

far
in

shall

object

the

reserve

district

clearing

bank it s e l f

upon

that

at

the

this

i s mandatory
lax? b e i n j

a

all

tc

parts

Federal

reserve

isscribe:".,

Cincinnati

at

ycu would
in

it

If

y o u hno\-,

e s t a b l i s h e d T i th­

ycu have

cities,

as

at

or P it ts -

C levelan:',

wculd

'jet f r o m t h e l o c a t i o n

city?

/
lir.

Sullivan:

The

Secretary

ycu,
Mr
other



Veil,
of

I

p r e s u m e we

the T r e a s u r y :

would,

That

is

U r.Secretary.
ail;

thank

Colonel.
Sullivan:
witness

cr

them.

bank into

established

facility

bs

of

?.3 p o s s i b l e .

important

every

The A ct,

establishe:!;

the
the

branch were

reserve

of

the

r e s e r v e b a n h . 11

'.Te s h o u l d l i k e

shall be

sre lo c a t e d

b u r -,

service

submit; y o u r

branch banks

be

district

cf

reserve bani and

I will.

the f a c i l i t i e s

one

the

the F e d e r a l

will

Act,

iistrict;

the

any

also

that

brin-_:

cf

if

Federal

imposed f o r

rendered by

2"cw,
provision

through, t h e

I

thank you.

e::cept Mayor

r~e w i l l

Baker,

net

present

any

ga7

M ayor B a k e r .
4592

STATELE1TT 0 ?

HOIM

IT217TOF D .

Mayor
The
your

Secretary
viewa,

Mayor
count

of

Cleveland.

Treasury:

W e '.Till b e g l a d

I

r/hich M r .
Tne

can a l l nothing

S u l l i v a n has

Council

of

the

to

Council

whatever
as

t.:e

tion

could

site

to

and
be

of

tnat,

a
I

the

Executive

and

have

as

the

City

C ity 's

of

reserve bank
have

been i n

party

verbal

Colonel

and

the

you



do n o t

in

ar.i t h e g r a p h i c

Ho w ,

I

want

appear

order

on b e h a l f

for

Colonel

that

to

present

Cleveland
I n addi­
with

Sullivan,

which have

S u lliv a n has
with

two

passed a

consultation

deliberations

ac

fcr

territory,

represented by

which Colonel

charts,

lias b e e n

to

constant

w nioh p r i n t e d c o p i e s a r e h e r e ,

tables

an here

Cleveland

this

a—

the

the b r i e f

to

in

in

tory

I

representative,

suited
cf

and

statistical

presented w ith propriety

Committee

been a

the

given,

re so lu tio n unanim ously directing ne
- tne

to h e a r

Mayor.

Eaker:

reasons:

the

of

BAKER,

re-

prepared,

eone

explana­

y^u cay have both

representation

cf what

the

saying.

do n o t

want

tc m u l t i p l y

words,

to h e a r m u l t i p l i e d w o r d s ,

and

and

I

so t h e

know
thirds




M ay o r B a k e r .
4593
that

I

a n he-e

compass,
The
you

and

to

such

of

the

length

That

Tne

of

s eCr e t a r y

limit
Mayor

muddle

placed within

a very

few

Treasury:

a very

narrow

minutes.

Y-'e a r e

glad

to h e a r

from

a s y o u wish,.

Mayor Eake~:

to

c a n be

said w it h in

Secretary

at

say

is

the

very

gracious

Treasury:

of yo u ,

Do

not

feel

much,

but

I

lot

of

L r . Secretary.
that

you have

yourself.
Baker:

this

Thank you very

discussion

at

all

with

a

do n o t ?/ant

to

irrelevant

matter.
The

secretary

clarify
as

you

it,

of

so w i t h

frict

mere
I

bank

this

we had

bank
in

count":.',
that

that

describe

serve

that

"e

feel

encouragement,

T h a n k y o u ve ~y m u c h .

exhibition

think

may

Treasury:

sure you w i l l

keep

it

up a s

long

like*

Mayor BakerL
the

the

it

of
a

in

CO' I d

not

local

pride

or p r e j u d i c e

felt

Cleveland,

Cleveland
s-nd

Foard

somewhat

how we

best

fairly

finer
about

the

said

be

We

the

the

that

do

general
of

Cleveland

on

than

of

cur

is

part.

that,

a

a

if

I

re­

reserve

interests
this

of

to by any

not want

putting

operation

conscious

appealed

sentiment
it.

unless

serves

facilitates

ma y be

Ve were

Act.

a city

of

the

1 think
of

the

M ayor B ak er
4594
United
and
a

a

States
city

good

went

to

deal

to

of

subject,

to

which

that
as

we
:e

realized
have

a

the

which

could

we

Sullivan

not



t he

in

must

be

entire

to

b ank might
get

just

bank

as yet

to

our

the

are

all

very

play

in

it.

have b een

out

the

w hich you have

find

no a n s w e r .

bravely

prom ised to

answer,

b u t we

submitted

a n d th e C o l o n e l

it

in

the

see

begin­

Cleveland,

bank.
the

also,

pointed
I

the

from a branch

a reserve

Pittsburgh

to

f r o m the
in

on

district

reference

would undoubtedly f e e l
and

presenting

own d e l i b e r a t i o n s

seek

of

City there

enactment

established

site

a n d we h a v

the

We r e a l i z e d
be

second,

to

a s m uch f a c i l i t i e s

there,

difficulty

our

Ohio

C om m it t ee who

feel,

a n d we

Act.

rather

one,

I

of

attitude,
from

a part w it h

has

find

out

Currency

and

trying

State

that

permitted

Sullivan

Cincinnati

reserve

is

feeling
of

w ould by being

that

the

c o n s i d e r a t i o n s we

been

the

would

realized

some

the

have

That

legislation,

he was

t h a t -a b r a n c h

bank

to

this

Colonel

of

in

of

substantially,

Cleveland

application

a City

a member

part

that

the

and

pleasure

of

through

ning

third.

pretty

the
So

here

itself

Congress

drafting

proud

and

of

contributed
and

first,

desire
a n d we

out,

that

Y7e

and

to

Colonel

supply you :
C om m it t ee

and

may
be g o i n g to t o u c h

could

some

££>10

ISayor B a k e r .
4595

hidden

spring
The

Ohio,
the

have

bo

ply

of

Vew E n g l a n d

that
this

these wise
voicing

states

are

stitute
going
system

of

for

the
of

most

possible

to

so

include

the

lending

which

to

He
territory

thought




are

to

that

of t h e
to

up t h e

the

t he

and

states;
and

how

United

We

it

head
and

air. djcr-

is

ever
by a

into

the

spread
some o f

absolutely

cov.ld f i n d

States,

they con­

States

country

is

I

ter­

of these

borrowing and

country,

They are

United

rest

which w i l l

of the

us.

that

i f we made

so f a r

financially,
the

all

and

self-contained

consultation,

districts;

of

t h en now.

of the

'b o r r o w i n g

divide

Pennsylvania

an

no w a y

in­
in

done.

which was.

contribution

phia,

part,

section

or w a s

could be

eelf-contained

districts

in

rest

said,--

enough

territory

problem,

that

the

wedge-shaped d i s t r i c t s ,

ou t

in

financially

said

b o r r 0 .7 i n g

F ew Y o r k ,

country

All

wd s t h e r e

financial

soluble

the

country.

concentrated
as

this

comprise

what

be

States,

nf

gentlemen

parts

to

information.

the w e a lth

states

ritory

of

as we
that

solution

center

inevitably

of

C le v e lan d a part
could

that

substantially

w o u l d be

at

the problem.

around Boston,
lending

see,

least

The

New Y o r k

districts.

of a

a

great

and P h i l a d e l ­

The

financial

f?a l l

M ayor B a k e r .
4596

m a e l s t r o m of th e
and

brought

has

had

tim e.

of

that

near

a s we

what

fifty

the w e a l t h

kind
So

last

a

of

the

effort

was

could

see,

would

we

t h i n k we

have

done.

in

that

district

a s we h a v e

to

u s to

balance,

by

so

that

would have
either

to

those

or

We

ion w a s
there
for

the

was

the

New Y o r k .

the

"Federal

felt

can

had

the

men

of

was

distinctly




an

least

and

the

of

that
Eank

other

central

sentiment

in

to
from

as

and that

is

represented
an

even

our d i s t r i c t
asking

some

for

to

its

very

country at

idea,

making a

strong f in a n c i a l

s ay

quite

frankly,

that

but

op posed to

that.

It

I think

the

it.

interpretation

of

that

sentiment

Y/hen t h e

ou r jStafle n e w s p a p e r s w e r e

personally

may w e l l

dis­
incept­

We knew

bank

s ym p a t h y w i t h

l e n d us

other

bank p l a n .
the

a long

which,

district

to le n d

B a n k i n g Act

the

are

nearly

Reserve

some

for

d e m a n d s f o r money

out,

seem t o u s

upon

of

it

pretty

on our p a r t

that

Cleveland had,

tankers
of

process

it

Chicago

district

seasonal

mapped

go t o

good deal

I

The

not

central

and

self-contained,

who know,

antithesis

a

be

did

perm ission

trict.

there,

t o m ake a

it

compulsory
money,

country

c e n t e r e d at New York

secondary maelstrom around

our

be,

years has

be

time

center

some

this

City

passed,-

very h e a rtily

at

I never

that

of

Act w a s

one

in

our

favor

Act w h i c h we b e l i e v e d w o u ld

enr-

ral?

respond v i t h

its

iictricts

might

evenly
jraro

as

spirit,

balancing

of

the

1 airly well

but

for

the

little

them.

development

the
is

there

eastern

part

of

the aap

we

the

lents

of

tricts

them and
used

to

the
the

or

not

It

is

banks

the

b y which




Hew

of

is

beat

be

of

would be

could
to

i f we

central

absorbing

theory

that

equiva­

to

dis­

as b e tw e e n
of growth,

against

in the

on t h o

the

remaining
and

have

the

establishing

possibility

those

is

among

in

substantial

districts

industry

where

superiors

t o be m a d e ,

suggest,

no g r e a t

no g r e a t

get

settled

there

that

the

Fast.

determine.

subject,

and

our

a plan

financial

center

at

es­

Whether

couldj

center

of

obtained;

equivalents

equivalent,

smaller

be

future,

among t h e

the

the

where

i s upon

you gentlemen w i l l

t h o u g h t we

and

of

precedents

thought w as

there

York,

sound,

it

and

the F a s t ,

the western

the

districts,

a kind

in

commerce a n d

among

attempted
six

im possibility

that

country,

might

A nd

strength,

financial

that

or

country,

predominating

at

five

balance

tablished

country.
is

of

so much o f
there

e v e n l y "balanced

e q u a l i t y might

and equivalents

drawn

financial

of

and

ahead,

the

first

lines

substantial

past

subordinates

am on g

the

as
the

thought

evolving western

all

have

recognizing

It was

where

set,

great

of

t h a t w o u l d make

be made,

country,

are

so

4507

M ay e r B a k e r .

Chicago,

but a

£sl3

M ay o r B a k e r .

4598
strong
to b e

district
between

pieces
put

by

between

two

their

Ohio

Lakes

means

of w e a l t h

chain,

that t e r r ito r y
and feelin g s,
ties

it

Council

had

not

The

of

this

based

on v e r y

trade

and

are we

to

City
they

of

the w ish es
take

that

part

to

cf P en n ­

a means

of

transportation

and

a

kind

of

b o th homogeneous

identity

in

its

a

to

interest,

development.

I

did

to be?

nL't

say

I want
it,

Cleveland would

sent

me h e r e

of

some

simply

to us

the

the

as

of
a

to

the

say a

m e m b er s

perhaps

you

country

touch

into

feel

of
I

outlying

general

on t h a t

districts,

concerning the

these

to

do.

Before

inform ation

of

to

around

Agriculture:

definite

seems

the W estern

the bank

arrangement

that

ground

a group

its

of

being

enough

as

it

If

strong

M ichigan

is

ought

the

And

a way b rin g s

in

subject.

done what

is

in

district

without

New Y o r k ,

and makes

Secretary

point,

that

a

strength.

which

where

on t h a t

the

of

together

Now,
word

part

two,

districts,

and E a s t e r n

Great

/and

such

superior

the V'estern

sylvania,

those

force

3ta t e s

statement

,

of
cr

of your

views?
Mayor E aker:
affects
And



I

the

say

It

io

district

that

almcct

entirely

i n w h i c h we

because

I want

to

are

arbitrary,
ourselves

b e more

than

except

as

concerned.
franx,

I want

eal4

1.'ayor Baker,.
45CC

to

say we

were

inform ation

more

as

to

except

those

isting

directions

trade
the

that

trade

East,

selected
that
ly

of

what

we

to

the

L a y or

out

to

in

the W estern

trade

which

arise

and

the

near

them,

t e r r ito r y was

be

rather

financial

lay

of

terr i t o r y •tra d e s

knew

of

doing

established

that

thing,

in

railroad^,

Northwest

of

helpless

presumptions

teen

"ecretary

cannot

ence

of

less
lines

of

the

all

their

The
we

of

sort

the

obvious

have

that

or

the

great

than

We h a d

felt

centers

to

East,
of

the

a nd we

trade

examination

of

that

necessarily
the

ex­

centers

^e

no

Putes,

from the

great

to

from an

it.

from

present­

relations.

Agriculture:
any

one

I

suppose

of t h ese

you

districts

realize

without

that

refer­

others?

BJcer:

^e

that

reaso n were

ther

than

one,

have

felt

that

emboldened to

and

leave

vei*y

suggest

you to

strongly,
eleven

deal w ith

the

and

for

districts
rest

of

ra­

the

country.
The
of

Secretary

the

ties

might

Hayor
the



direction
cause

Baker:

territory

of

the

of

t"ade

us

to

We f e l t
to

Agriculture:

the

and

the

rearrange
that

South

of

And

wishes
it

very
Ohio

the
cf

consideration
certain

communi­

considerably.

strongly.
and

asked

We

did

consider

ourselves

quite

fealS

Mayor Baker
4600

earnestly,
to

be

that

the

attached

to

ance

could
of

would
that

be

that

be

of

the

just

the
Ohio
if

land,

Baker:

without

course,

I

still




by

any

part

Vorth*

to

its

have

It

m ade

that

se em s

it,

ought
to

and

the

this

civilization

distinct

a

River

in

any

of

part

us

remands

disturbed,

so

Ohio

of

seasonal

adding

for

bal­

equipoise

the

as

territory

River.
turn

to

the

It

is

am o n l y

conside^ation

of

the

City

very

sudden
that

no

other

seizure

more

seizes

strong
a

or

less

son

the

on m e .

city
of

in

some
up

the
new

its

of

population,

to

talk

foolish,
this

of

Cleveland

has,

United

I

think
States.

invention

an

or

about

Cleve­

because,

City,

im agination

manufacture

g r o w n ye<%r b y y e a r w i t h
in

f o r me

steadiness which

h.sb oo sted

both

Yes.

ve^y hard

an adopted

it

cf

growth,

t h e w ay we

Agriculture:

growth

has

in

the

ar

of

grown w i t h

it

to

territory

I may

years,

whim

country

appearing

mour w i t h w h i c h

no

to w h e th e r

a m om e n t ?

Secretary

layor

as

t e r r i t o r y w o u l d be

of

Now,

The

ma de

disturbed

south

north

is

the

a well-balanced

money

for

question

and

the
in

the

of
gla­

individual
the

last

±5

characterises
There

has

the

been

p assing mechanical

or p o p u l a t i o n ,

apparently

in m a n u fa ctu res,

even

rite

industry,

but
of

&a l 6

Mayor B a k e r .
4601

commerce,
trust
than

I

tank

can

any

balances

make

of

you

them,

independence

not

not

prcvidencial

go b a c k

to

the

site

regional

of

a

help

glacial

ourselves

the

world.

and

our p o p u l a t i o n

is

all

the

the

people

peoples
are

cf

either

and yet

general

Government

the

immigrant

solved

the

any

that

people

its

civic

think



of

place,

have

any

city

or

Frie

cosmopolitan

or

great

unite

saying

come

and

I

is

an

entirely

developed

other

think,

place.

in
I

is

us

the

of

a year,

made

per

cent

up
of

foreign

both

f^om

to

a way that
have

I

of
ou r

par­
the

to

people
due

can­

from a l l

self-conscious

myself

there

is

study

Cleveland

foreign^born

that,

it

universities
that

-- ± s n a i l
put

immigrants

children

from t h e

United

t h i n k we

population,

who h a ve

in

was

I

to

Seventy-five

born,

here,.

the

whether

come

thousand

live

of

n o t f and

People

aggressive

probably,

city,

I

importance

that

absorbing

become

conscience
in

bank,

experts

and

more

-- L a k e

great

world.

problem,

ether

exists

a

those

problem

than

a

thing which

looking,

sixth

period

the

people

the

thirty

foreign

entage,

the

very w e ll.

We g e t

in

dispensation,

Cleveland
reserve

forward

of

only

by

to make

over

is

and

view w it h

the

but

obviously

not

is

patriotism

Cleveland
States,

gentlemen

which

and

and w e a l t h

has

better
the

fact

city,
do

been

not
almost

ga-l?

K a y or B a k e r
4602

exclusively
know
and

very

I

the

student

little

studied

them,
in

a

about

other

think

of

civic

consciousness

us

the

which
the
in

solution

Colonel

street

so

far

a method

on

part

the

city

about
that

if

would

the

point
that

city

they would
the

determine



in

to

of

great

from
in

which

the
it

in
our

in

readily

regional
in

any

to

and

acquisition
That

has

our

but

The

solution

feel

ve^y

rivals

this

honor,

had
in

bank,

been

mind about
and

selected,

recognition
as we
place.

shall
Bu t

of

of

in

sure

other
if

it,

the most

pro­

and that
Cleveland

fall
the

problem

conflict

the

known

brief

repose

that

for

a

I

economic

economic

I

of

unimportant

showing,

and

And

to

led

Cleveland,

best

seen

pre-eminence

political

a nyb o d y's

other

I have

problems.

promises

the

district

as

the

political

to

disparagement

thing- e n t i r e l y

cities*

largest,

the

a

economic

id

in

refers

which

placed

so

complete

concerned,

other

and

any

many c i t y

to

pretending

conscience.

has read

generously

in

put

civic

approach

the

fall

site

a

you are

bank were
us,

feel

may c l a i m a

our people

about

gressive

as

of

matters

the

be

as

affairs,

and w i t h o u t

question,

distinct

local

cities
that

of

as

a

Sullivan

think,
The

of

affairs,

development,

and

railroid

itself,

national

Cleveland

matter

m unicipal

cities,

civic
to

of

in

if

guiding

you

SQ18

Mayor B a k e r ,
4603

spirit
we

of

can,

our

your

w h e t h e r we
that

the

this

ilitated

it

a

of

Mr.

of

&

our
P.
"I

t o s h 's
this
day

Trust




or two
banks

regret

other
City

that

out

that

my

illness,

and

operative,

bank

and
I

I want
it,

trust

in

is

to be

in h e r e ,
ou r

of

fac­

the

order

companies

a

letter

community,

to

who

Guardian

perm ission

in

sudden

illness,

compels

us

to

to

read

show t h e

towards t h is

receiving

Cleveland
pleasant

citizens

to

heartily

for

spir­
Law.

here

in making

locate

and
a

and

to

their
please

Regional

co-operate w it h

M cIn­
"Florida

next

S ecr eta ry McAdoo,

and agreeable,

conclude

and K r s .

leave

p r e v e n t i n g my b e i n g

Comptroller W illia m s ,

I will

of

hampered.

came
of

knot

bank,

operation

going

if

a n d we

a branch

the

not

President

of

or

under

bankers

and

and

law

facilitate,

says:

thereby

they

the

to

Board,

t o me a s

eminent

ill,

M cIntosh

with

if

country

handed

participate

that

this

every way,

Company,

state

Houston

city,

in

taken

evening,

Sixth

throughout

reserve

this

mo s t

prolonged

to

of

had

the

tary

me

I

sentence

H.

regional

aided

suddenly

just

in making

a

been

adm inistered
as
- by y o u r
and

one

Savings

task
get

Now

was

has

business

lav/,

from

city

Tues­

Secre­

co-operate
visit

to

assure
Bank

other

in

the

them fc
this

citizens

ir

gal 9

l a y or B a k e r ,
4604

endeavoring
of

the

the

t o m ake

system.

location

sented

I

of

by H is

this

an

"bank on e

sure

such

that

the

a bank w i l l

Honor,

of

the

’ Shining

claims

be

ably

Mayor Newton D .

of

Cleveland

and

Baker,

Lights'

forcibly
and

Col.

the

above

for
pre­

J.

J.

Sullivan.
"Please
men,

and

kindly

believe

me

to

c o n v e y my r e g r e t s

to

gentle­

be
Your3 truly,
(Signed)

The
if

Secretary

you

of

Baker:

I

will

that

pose

of

showing

here

as

expressing

our

and

city,

a matte-"

their

to

me
me

about



That

of

except

pride

towards

be

Ic ln to s h ."

l e t t e r ma y b e

this

and
Bill

any w ay.

any

question

to

a

It

try

to

of

the

personal

filed

filed,

is

great

are

one

that

I

it.

money,

and an

for

the

universally
trust

both

financial

answer

borrowing

is
be

companies

in

about
in

this.

judgment

trust

great

happiness

it

the

our

there

anything

file

a man w h o w o u l d

co-operate

If

ask

and

attitude

desire

give

Treasury:

P.

like.

Mayor

of

the

E.

sympathy

can

answer,

trust

because

intimate

regarded

companies

ornament

strength

of

I

an

pur­

to

us,

and

it

a

will

you w i l l
I know

way.

not

nothing

ga2°

M ay o r E a k e r .

The

Secretary

and m yself
%e

have
The

got

not

into

Secretary

from

that

care

of

point

such

Mayor
care

do

of

the

you,

the

Agriculture:

of

view

I have

Secretary

‘ ayor
The

of

the

Baker.

ju n c tu .e ,

the

Thank

if

of

the

w ou w i l l

these
to

significance




is

tell

us

whether

sufficient

district

We

p erm it me,

bent

bring

Sullivan:

The

Secretary

exhibits.
here?

out

than

of

Are

in
the

that.
We

are

o f mind

questions

Mr.

have

the

Treasury:

any

as

since

to

take

amply

able

to

take

are

very much

obliged

to

you very much.

indicating

order

You might

T-easury;

witnesses

in

direction,

needs.

the

ask

that

Secretary

employ.

district

found

to

to

in

the

Mayor.

Secretary

add-ess

it

G overnm ent's

of

am a f r a i d

needsi

Baker:

Mr.

I

know much a b o u t

o f my p e r s o n a l

The

Treasury:

4605

the
you

or

I may

say at

that

the

questions

to

be

opinion

order

to

on

and

at

our

this

any

part.

the
they

facts
have

w h i c h we
time
We

as

have

and
no

other

t h a n k " ‘O u .

somecharts,

Treasury:
going

taken

develop

arguments,
We

have

not

And

to

let

Mr.

Will
us

Secretary.

you
have

please
this

file

those

map w h i c h y o u

ga2l
4606
IEr

, Sullivan :

Lr.

Paxter:

The

secretary

Have you ^ny

y CSo
It

ls

of

,.n a b s o l u t e

,.he Tre<iB UBy ;

d u p l l e e .t e
Thiit

of

th(?

need

be

^

^

others?

Kr.

Baxter:

They

The

secretary

of

can
the

be

prepared.

Treasury:

We , o u l d

1Ut.

tho8e

to ^

triplicate„
Hr.

Baxter:

I

The

Secretary

pared.

Does

Kr.

Sullivan:

The

^ec-etary

represented

cji

of

this

have

the

of

by } r.

secretary

residence
Kr.

^nd

cf

Bank,

the

Secretary

Kr.

Kiesev/etter:

and

comLie^cial

Ko,
for

the

case

T-easurr:

No,,

can have

the*

pre­

Clfveland?
for

"lev elan d.

ColuMbus,

I

see,

is

Kieser/etter.

the

OF L .

*b\

Treasury:

t.

p.

Columbus,

The




case

to y o u.

.

you u a y

st-.te y o u r n ^ e ,

occupation.

Kiesev/etter:

National

the

closes

S T ATJ 5.J W T

The

sent

Treaaury:

close
This

them

of

the

Kiesev,etter,

interests

the

Ohio

Ohio.

Treasury:

The

Cashier c f

Columbus
of

that

What

do y o u

represent?

C l e a r i n g House
Cit--.

Association

i

g a 2£

L.

The

Secretary

the

accredited

ber

of

lr.

of

t he

Secretary

Ch am b er

of

^ec^etari:

your

vie\ 7 s a n d

thiB

district

trict,
]r.
makes

-.e

the

bank,
there

the

bank

la^ge

which

of

Board

Commerce

treasury:

expressed,

of

Trade

or

and

the

as

~ham­

^lea^ing

us

be

the
has
.re

our

problem?

7-ou . ; i l l k i n d l y g i v e u s

If

if

addressing yourself

v ov.

by

glad

*re

Cleveland

to

or to

some

district

.vhich w e

have

m os t

suitable

location

for

Ohic

as

its

ad j icent

the

but

to

other

dis­

he-.r f r o m y o u .

The

enourh,

^ecreta**;’ o f

You know

" " e isury:

presented

central

to
not

it
too

Treasury!

in mind

a regional

dominating

t h a t w o u l d be
large
Have

and

-vhich

influence,
needed

not

too

y o u a map

of

tc

make

small-the

sug­

district?
K i e s e ’v e t t e r :
is

very

Yes,

I

have

it

in

the

paper

I

h*ve

here

sho**t.

The

"ecretary

Ur.

Kiesew etter:




the

tell

''o lu ^ b u s

then

lr.

of

should

and

gested

vhe

that

veg.

I'iesew etter 1

reserve

The

of

is

together.

1 !r. K i e s e w e t t e r :
The

Ho w

n omi' erc e?

Association

The

Treasury:

~ep~etentative

Kiesewett--r:

Horse

46Q7

T . lliesew etter

of

1 be T rea su ry *
Yes,

it

is

Cot I d

bound

in

you

let

the

rest

vs
of

see

it?

this.

L.

The S e c r e t a r y

of the T r e a s u r y :

Mr . K i e s e w e t t e r :
b u t not

Poard,

The c o n f l i c t

portant

What we h a v e
as

it

is

You w i l l
take

into

features

to say i s ,

short,

amount

of m a t e r ia l

in our o p i n i o n ,

soon be r e a d y f o r

retrospection,

c o n s i d e r a t i o n more p a r t i c u l a r l y

o f the whole

a s im­

situation,

and want

the g e n e r a l

t o g e t h e r w i t h t h e more

in the Fed eral Reserve

Act

locations.
In t h e

survey

o f the c i t i e s ,

general

conclusion that

divided

into

No.

opinions,

and t o t h e p o i n t .

or l e s s mandatory p r o v i s i o n s
as to

of

t h e v a r i o u s h e a r i n g s g r a n t e d by y o u r Honorable

has f u r n i s h e d you w i t h a v a s t

to s i f t .

to

You may p r o c e e d .

You a r e n e a r i n g t h e end o f y o u r t r i p

c f your lab o rs,

expressed at

460A

F . Kiesew etter

1-

settled,

the United S t a t e s

c a n w e l l be

t h r e e main s c c t i o n s : -

That
is

one comes t o t h e

part

richest

of the

c o u n t r y w h ic h h a s been l o n g e s t

in w e a l t h ,

and i s

east

of the

Appala­

ch ian Mountains.
No.
which

2 - That p a r t
is

richest

which l i e s

of

the

in a g r i c u l t u r e ,

settled,

i n d u s t r y and commerce,

b e t w e e n t h e A p p a l a c h i a n s and t h e R o c k i e s ,

w h i c h m i g h t w e l l be c a l l e d



country which was next

the v a l l e y

of

and

t he M i s s i s s i p p i

L.

P.

Kiesew etter

46 09
and

its

No .

tributaries.

3-

mining,

That r a p i d l y g r o w in g s e c t i o n w h ic h i s

agriculture,

a s to deserve

cities

choice

from time t o tim e,

that

those west

in t h e i r broad,

agreed that

generous,

San F r a n c i s c o

and

on t h e p a r t

of the Rockies
western

spirit,

should be t h e i r

f o r a F e d e r a l R e s e r v e Bank*
For the country e a s t

that

i n d u s t r y and commerce

from o b s e r v i n g t h e a t t i t u d e

there lo c a te d ,

have j o i n e d f o r c e s
and have a l l

in

o f the Rocky Mo un tain s.

We t a k e i t ,
the

culture,

improved f a c i l i t i e s

which l i e s west

Of

fruit

so r i c h

o f t h e A p p a l a c h i a n we presume

f o u r F e d e r a l R e s e r v e Bank s w i l l

t e n t a t i v e l y be,

for

sake o f argument,

serve,

w h i c h mi ght

placed at

Boston,
New Y o r k ,
Philadelphia,

Baltimore

o r Richmond,

and

Atlanta,
'■e now come t o t h a t

great

t w e e n t h e mo u n t a i n r a n g e s o f t h e
central

point,

g iv in g weight

heavier fin a n c ia l
ly

select




operations

expansee

of t e r r i t o r y

e a s t and o f t h e w e s t .

be­
As a

t o t h e d e n s e r p o p u l a t i o n and
in the e a s te r n p a r t ,

Chicago as the p i v o t a l point

we n a t u r a l ­

in the no rth ,

Dallas

L.

F.

Kiesew etter

4619

o r New O r l e a n s
west,

in the

south,

and Col umbus i n t h e

want to

St.

east.

inclu de M inneapolis to

Louis
It

or Kansas C i t y

is possible

serve the g r e a t

in the

that you w ilJ
Northwest

and k e e p t h e C h i c a g o A s s o c i a t i o n f r o m b e c o mi n g t o o v a s t .
I f you w i l l

take a glance at

evenly d istrib u ted these
consideration,
lines
be

--

of tra v e l

served in

that

t h e map y o u w i l l

points are,

is,

density

taking a l l

into

the current

to the t e r r i t o r y

to

each i n s t a n c e .

T h i s w o u l d make n i n e b a n k s i n t h e
ffe a r e

things

of population,

and t h e a c c e s s i b i l i t y

s e e hov.

system at

t h i s time.,

u n d e r t h e i m p r e s s i o n t h a t y o u r H o n o r a b l e Committee

w o u l d p r e f e r n o t t o e s t a b l i s h t he l i m i t
namely t w e l v e ,
degree,

for

but r a t h e r l e a v e

later

institutions

the

o f t h e number a l l o w e d ,

situation

ope n,

in a

as the g r e a t w estern country

d e v e l o p s and p r o s p e r s .
Coming more d i r e c t l y
a d d r e ssin g you,
and t h e

in the

l rom the
routes
to

east

to

the w e s t .

degree,

o f the

lies

from the

p ass through t h i s

the g r e a t e s t




center

Appalachian range,

which h as a lw a y s been,

t o t h e p o i n t a b o u t w h i c h we a r e

All

state.

s e c t i o n between Ch icag o

the great
earliest

state
times,

o f Oh i o ,
the gateway

of the t r a n s - c o n t i n e n t a l
its

agriculture,

i n t e r e s t s which a r e ,
industry,

commerce and

ga26

L.

mining,

all

h a v e an e q u a l l y

sented by the

investment

of m illio n s

of d o llars*

shadows any

of

fu lly

large.

makeup t o
the

F.

the
It

take

seasons.

Kiesew etter

important

4611

part,

o f many h u n d r e d s ,
There

others,

and a r e

y e s thousands,

i s no one f e a t u r e w h i c h o v e r ­

no r any c i t y w h i c h

of

its

constituent

The b a n k i n g power o f t h i s

section

W e s t e r n New Y o r k ,

gan,

Northeastern Kentucky,

Indiana,

Wes t V i r g i n i a )
Bank w i t h

about

& 8,000,000.

would b r i n g

*16,000,000.

of paid

one w h i c h w o u l d

The d e p o s i t s w i t h

as

to gain

of

point

a Federal Reserve

in c a p i t a l .

be d o m i n a t e d b y a n y

this

Northwestern

subscribed c a p i t a l

it

A good s t r o n g
others.

the a s c e n d e n c y over any o t h e r .

and
it

would

institution,

but

N e i t h e r would

i n t e r e s t s w h i c h w o u l d be

s h o u l d be p a r t i c u l a r l y

its

(Ohio),

of

overshadow the

in

Southeastern Michi­

into existen ce

be a p p r o x i m a t e l y '‘* 6 0 , 0 0 0 , 0 0 0 .
not

overpower-

banks through a l l

Western P e n n sylv a n ia ,
Fastern

is

would be a d i s t r i c t w e l l b a l a n c e d

care

repre­

so p o w e r f u l

We f e e l

that

e m p h a s i z e d i n o ur

statement

the f a c t s .
A post

on t h e

part

to

situation,

the

of

card vote

Columbus a s t h e



g a th ere d from t h i s

section

o v e r a t h o u s a n d b a n k e r s who h a v e
a m ajo rity preference

central

place,

for

indicates

given

the c i t y

geographically,

for

study
of

a Federal

f a27

L.

Reserve

proval"?

That i s

cities,

selection

Oh i o ,

as your in t e re s t s are

2 is

What w a s t h e q u e s t i o n asked'
to

show,

Mr.

o f C ol umbus ,

Ohi o,

as

i s j u s t what

the f i r s t

"Woul d Col umbus,

.,o.

4612

I want

o f a F e d e r a l R e s e r v e Bank, meet w i t h y o u r a p ­

The n e x t
to

That

"Woul d t he

the l o c a t i o n

far

of A g r ic u ltu re :

Kiesewetter:

Secretary.

was,

Kiesew etter

Bank.

The S e c r e t a r y
Mr .

F.

The s e c o n d q u e s t i o n

be a c o n v e n i e n t

location,

so

concerned?"

q u e s t i o n a s k e d o f them w a s

negative,

first,

question.

please

" I f your-answer

i n d i c a t e below you r ch o ice

of

s e c o n d and t h i r d . "

I have a copy o f the l e t t e r which was a d d r e s s e d ,
and o f t h e p o s t

ca rd which was sent f o r r e p l y ,

no d o u b t y o u w o u l d l i k e
The S e c r e t a r y

t o keep f o r

of the T r e a s u r y :

which I have

the f i l e s .

Yes.

( The p a p e r s w e r e a c c o r d i n g l y f i l e d ) .
The

letter

is

as fo llo w s):

To t h e Eank A d d r e s s e d :
It

i s b e c o mi n g more e v i d e n t

e v e r y day t h a t

eral

R e s e r v e Bank O r g a n i z a t i o n Commi t tee w i l l

eral

R e s e r v e B a n k s a t t h e most

phically,



for

the

convenient

the Fed­

locate

points,

d i s t r i c t s which such banks are

Fed­

geogra­
to

serve.

Sa 28

L.

It
Eoston,

P.

Kiesewetter

i s a ls o reasonable

New Y o r k ,

and C h i c a g o w i l l

Baltimore,

'

4613"

t o presume t h a t
Atlanta,

be among t h e c i t i e s

such c e n t e r s as

New O r l e a n s ,
selected.

St.

Louis

Between the

d i s t r i c t s w h i c h t h e F e d e r a l R e s e r v e Ba nk s l o c a t e d i n t h e
c i t i e s mentioned w i l l
this

be p e r m i t t e d t o

g r e a t M i d d l e Wes t c o u n t r y ,

and b u s y w i t h

serve,

very rich

be l o c a t e d

somewhere

at_ t h e p l a c e w h i c h i s

g e o g r a p h i c a l l y the

logically

a nd ea s i e s t

the n atu ra l

f or the b e n e f i t

point

of t h e whole t e r r i t o r y

W i l l you p lease

at

lies

in a g ric u ltu re

i n d u s t r y and commerce.

A b a nk w i l l

the

there

in t h i s d i s t r i c t ,
c e n t e r and t h e r e f o r e
o f c o mmu n i c a t i o n

t o be s e r v e d .

express your preference

q u e s t i o n s on t h e c l o s e d p o s t

by an s w e r i n g

c a r d and m a i l i n g t h e

same

once?
Yours v e r y t ^ u l y ,
THE COMMITTEE
R e p r e s e n t i n g t he C o m m e r c i a l , A g r i c u l t u r a l ,
I n d u s t r i a l and B a n k i n g I n t e r e s t s o f C e n t r a l
Oh i o .
The S e c r e t a r y

of the T r e a s u r y :

How many b a n k s a n s w e r e d

that?
Mr. K i e s e w e t t e r :
list

o f the




A little

o v e r One t h o u s a n d .

c i t i e s which r e p lie d .

I have a

I d i d not b r i n g the p os t

L.

c a r d s w i t h me b e c a u s e

it

S’ . K i e s e w e t t e r

was a v e r y b u l k y p r o p o s i t i o n ,

I w o u l d be g l a d t o send them t o y o u ,
The
w ill

Secretary

of the T r e a s u r y :

read

it

Yes,

y o u want them*

The r e s u l t

o f the p o l l

t h e map a s k i n g

choices,

land 2 8 3;

gives

eastern part

Col umbus,

Then t h e r e w e r e
of the

Secretary

434;

and a d d i n g

r e c e i v e d f o r the

Cincinnati 425;

Louisville

139;

on~

Cleve­

Chicago 1 2 6 ;

scattering votes a l l

over the

country*

of A g r ic u ltu re :

t h e y would p r e f e r

in t h i s

shown b y t h e r e p l i e s

card

outlined

s e c o n d and t h i r d c h o i c e ,

Pittsburgh" 222;

and so o n .

The

as

and I w i l l

The p o s t

the banks in the d i s t r i c t

for f i r s t ,

the vtotes t o g e t h e r ,
three

I h a v e t h a t w i t h me h e r e ,

t o y o u w h i l e we a r e on t h e t o p i c .

p o l l w a s made o f a l l

Cleveland

Y o u r c a r d d i d not a s k w h e ­
or C i n c i n n a t i

or Columbus

d istrict?

Mr. K ie s e w e t t e r :
The S e c r e t a r y
be

if

but

be s u f f i c i e n t .

Mr. K i c s e w e t t e r :

ther

4614

No,

sir.

of A gricultu re:

It

just

asked i f

t h a t would

convenient?
Mr .

Kiesewetter:

proval,
asked.



or would i t

"Woul d t h a t

s e l e c t i o n meet w i t h y o u r a p ­

be c o n v e n i e n t . "

That

i s what t h e

card

ga30

L.

The S e c r e t a r y
that

poll,

Simply th a t

Mr. K i e s e w e t t e r :

it

for

would best

have

I think

these

suit

J u s t what

do y o u g a t h e r f rom

i t w o u l d be c o n v e n i e n t ?

i t w o u l d be t h e most

gentlemen in t h i s

their

4615

section,

convenient
showing t ha t

needs f o r the b u s i n e s s w hi c h they

t o t r a n s a c t w i t h a F e d e r a l R e s e r v e Bank.

The S e c r e t a r y
indicates
city

of A g r ic u ltu re :

Kiesewetter:

be t h e most

I would g a t h e r t h a t

convenient point

that

Yes.
quite

view p o in ts .

situation
a measure,

broadly,

the c i t i e s

that

in the p la c e

so t h a t

It

is

The most

e a s y t o be s e e n ,

a few bank ers are
We n o t i c e

that

local

they

however,

f r om

or p r e j u d i c e d

t h e y do not t a k e

the

t h e y do n o t t r y t o p u t t h e m s e l v e s ,
o f y o u r H o n o r a b l e C o mmi t t e e ,

to

importance.




district

convenient p o in t?

of the country c o n s id e r a t i o n

financial

Columbus woul d

in t h i s

g i v i n g each part
its

indicates

it.

of Agriculture:

Kiesewetter:

replies,

for

poll

that

a F e d e r a l R e serv e Eank,

c o u l d do b u s i n e s s w i t h
The S e c r e t a r y

the

s e c o n d and t h i r d c h o i c e ,

k t which to l o c a t e

in t h e i r

the p o ll

d istrict?

from the f i r s t ,

Mr .

Do y o u g a t h e r t h a t

t h o s e B a nk s w o u l d p r e f e r Col umbus t o a n y o t h e r

in t h i s

Kr.

the

Kiesew etter.

of A g ricu ltu re :

then?

arrangement

F.

We b e l i e v e

by

in pro p ortio n

that you w i l l

find

in

ga31

L.

the v o te ,
dicate

which you are

this

F.

Kiesewetter

t a k i n g on y o u r

card

t r y i n g to a r r i v e

at

conclusions,

c o mmendat i o n b a s e d on s u c h c o n c l u s i o n s ,
a degree as p o ssib le
greatest

The b e s t
s e n t t o meet
that

all

in

our c a s e ,

which,

w ill

in­

therefore,

the co n d itio n s.

Col umbus a s a c e n t e r ,

is

and a r e ­
to as great

meets y o u r point

g ood f o r t h e g r e a t e s t

location,

ated to take care
say,

system,

same a t t i t u d e .

We a r e

namely the

4616

It

is

number.
t h e one we r e p r e ­

i s unquestionably true

a c i t y which i s

ideally

of a d i s t r i c t with a radius of,

t wo h u n d r e d and t w e n t y - f i v e m i l e s .

tu tio n s w ithin that
t h e ma i n o r b r a n c h

territory
offices,

are

most

of view,

situ­

we w i l l

No b a n k i n g i n s t i ­

over f i v e

h o u r s away f r om

o f them o n l y two h o u r s

distant.
If

a F e d e r a l R e s e r v e Bank i s

i n Columbus,
Cleveland,

Buffalo,

Toledo,

We a r e

important branches,

proper

that

Indianapolis,

in f a v o r

importance

c o n s t r i b u t i o n s to the c a p i t a l

Louisville

o f t h e i d e a of_

and we w o u l d t h i n k i t

the branches should bear

Ea nk o f t h e i r



Detroit,

heartily

having

their

the c e n t e r ,

t h e b r a n c h e s c o u l d w e l l be p l a c e d a t P i t t s b u r g ,

and C i n c i n n a t i .

to

located at

entirely
in pro p ortio n

o f the F e d e r a l R e se r ve

district.

The v a l u e - o f a c e n t r a l• l o c a t•i o* n

is

e m p h a s i z e d when

L.

The v a l u e
one g o e s i n t o
bankers.
h alf,

of a ce n tral

a closer

We b e l i e v e

t h a t you w i l l

of b a n k in g i n s t i t u t i o n s
banks,

representing

highly

important,

m

transit;

again at

ing in

if

of tran sit.

On t h a t

interest

t h e F e d e r a l R e s e r v e Bank i s

thereby

its

d istrict,

saving a l l

on t h e money w h i c h i s

alone

is

it

to every

point

t i me

t i me and
is highly

thus f l o a t ­

an item of g r e a t

conse­

Columbus w o u l d be e n t i t l e d t o

a s we know t h e t e r r i t o r y w h i c h i s

on t h e map h e r e w i t h ,

d oes not o v e r l a p t h a t

Atlanta,

not w i s h t o

Few O r l e a n s ,

conflict

St.

Baltimore,

L o u i s or C h i c a g o , We do

w i t h any o t h e r d i s t r i c t .

m i t t e e h a s made up i t s

indicated

r e q u e s t e d by the

d i s t r i c t s w h i c h h a v e b e e n a s k e d f o r b y New Yofck,




that

possible

Rapidity of c o lle c t io n

i n g r e a t volume,
score

is

consideration.

So f a r

Ri c hmond,

It

t h e p o i n t w h i c h w i l l be n e a r e s t

d istrict,

and t h e

your f i r s t

i n many i n s t a n c e s ,

o f t h e vol ume o f t r a n s a c t i o n s

o f C l e a r i n g House f o r

conventions.

the m a ils

quence.

e mp h a s i z e d when

We h a v e h e a r d b a n k e r s u r g i n g t h i s

their

aesirable,

find,

in the course

therefore,

in the

is

c o n s i s t i n g of b u s i n e s s w ith other

items

s n o u x d be l o c a t e d a t
other point

location

4617

e x a m i n a t i o n o f t h e b u s i n e s s done by

o r e v e n more t h a n h a l f ,

t o become a s o r t

K iesew etter

P.

If

mi nd t o what d i s t a n c e t h e

t h e Com­
primary p oints

ga-33

L.

w ill
the

extend,

in t h e i r

F.

sphere of

secondary lo c a t io n s ,

establish

i n o ur

advantageous point
Chicago.
w ill

for

influence,

suc h a s t h e

section,

4618

Kiesewetter

w ill

we b e l i e v e

that

one we a r e a t t e m p t i n g t o

c a u s e Col umbus t o be t h e most

the t e r r i t o r y

b e t w e e n New Y o r k and

E y p r i m a r y l o c a t i o n s we mean p o i n t s a t w h i c h i t

be f o u n d

granted that

indispensible

s u c h p o i n t s a r e New Y o r k ,

I
New Y o r k ,

to lo c a t e

suppose

it

is

a bank.

We t a k e

Chicago,

quite well

it

for

San F r a n c i s c o .

a g r e e d , we w i l l

say,

C h i c a g o and Sa n F r a n c i s c o a r e p r i m a r y p o i n t s . We

cannot-The

Secretary

o f the T r e a s u r y :

The Commi t tee makes no such

concession y e tITr. K i e s e w e t t e r :
b u t we w i l l
are

No,

I know y o u make no s u c h c o n c e s s i o n ,

say f o r the

sake

of argument,

that

those p l a c e s -

primary p o in ts .

The S e c r e t a r y

of the T rea su ry:

You assume t h a t

as a hypo-

the s i s?
L'r . K i e s e w e t t e r :
other p oin ts are

not

Yes,

merely f o r

r e la t iv e ly as

t h i s purpose,

that

the

important as those three

points.
E y s e c o n d a r y p o i n t s we mean suc h d i s t r i c t s a s a r e ,
in a measure,



elastic,

d e p e n d i n g upon what

is

included in the

tha

i"

£a ^ 4

primary
to

districts.

adjustment,

because

we

do

whereas

a

location

there

in w hich you
the

banking

The
go

it

Secretary
over

this
ation

of

that

the

could

Reserve

and

go

the
it

be

into

That

subject

too

other

large
districts.

sh ou ld be

selected,

decided

there

to-morrow m o r n i n g

is

a

V7e a r e

picture

not

go

it

would

not

in
be

could have
than
of

that.

Th,:-y a r e

all

Kiesewetter:

prepared

Treasury:

Hank 3 o a r d

could

quicker

not

at

The

is
and

of

prepared

to

for

there

the

Treasury:

do

is

has

ready and

district,

for

F ^d.ral

other

We

far?
no j u r i s ­

t he

whatever

t o-m orr ow m o r n i n g a n d

any

on a

go t h a t

Committee

it

this

hampered
its

to

all.

I me an b y t h a t ,

be,

district

are

question

Secretary

iCr.

be made

if

should

Treasury:

You

The




location,

Columbus

the

Kiesewetter:

might

ness,

cannot

are

far.

The

Federal

points

overshadow

do b u s i n e s s .

of

Kiesew etter:

Kr.

a

which you

l .r ,

diction

others

other

4619

room *

secretary

that

is

that

could

these

th em t o

there

Committee

is,

the

not want

Further,
by your

That

]pt K i e s e w e t t e r

district

lack

of

ho s e r v e
in

Well,

the
each

da b u s i ­

location,

3ank

in

country,
city

and

oper­
I

tells

think.
us

par.
not

believe-

that

your* H o n o r a b l e

pa

L.

Committee w i l l
population
located

cf

a Federal

railroad
points
sure
the
ly

it

is
is

not

Reserve

the

bear

of yo ur

distasteful

It

large

enough

has
other

should

in

such c i t y

is

to

for

be

city with

such
not

served.

the

direct

and quicker
all

of

be

was

brought

the

pres­

injunction

pressure

in

location

no p o l i t i c a l

in m i n d y o u r
that

city

in p o p u la t io n

more

h .s b r o u g h t

labors
and

largest

district
city

any

having

to y o u ,

the

It

than

the

largest

Sank.

upon y c u ,

beginning

of

than

district.

select

4620

p a r t i c u l a r l y when

the

more

comnunication

in

to

power,

circumference

Columbus

district,

Kiesewetter

com p elled to

banking

on t h e

Although
the

or

feel

I.

at

decided­

into

t he

matter.
Further,
bus

ready

outfit
very

cf

for
an

a

at

institution
situated,

guarding

cf

e tc .,

counters,

your

fact

is

not

groundfloor
period

tellers1

in

in the

any moment.

valuables,

-- i n

location

that

2 0 " a considerable

equipped w it h

"ooir.s,

is

oocupancy

centrally

leased

there

It

now

of y e a r s ,

cons- l t a t i o n

is

the

that

Summing

up w h a t

vaults

said,

in

complete

can

a

be

fo~

the

or c o m m i t t e e

e v e r y cia y d e s i r a b l e

we h a v e

Colum­

i f wanted--well

pose t .




cf

in b u s i n e s s ,

ro om ,

cages,

City

short:

for your

safe­
o
pur­

1 .
and

four

(or

between,

or

at

w ovid

co u n tr y 's
sod

Pour

banks

business

im plied

by

to

of

district

mapped

convenience

logically,
in

the

the

the

of

out,

for

country

ever-

a

in
the

its

s :*1 1 ;

it

conceivable

^orld
of

Reserve

one

 t c ~e st


line

of

powerful

a

daily

in

r isk s v/ell

enough

intent

the
expres-

density

commerce

of

of

population
im-

the

of communication,

those

is

of

contact

the

place,

i n t e n d e d t o be

included

to be

put

busy

nearly

overshadowing any
particularly

v /;d th

its

bor-

and

and c O M u e r c i - . l l y .

all

and p l e n t i f u l l y

to be

too la rg e ,

g o i n g on w i t h i n

r oP ’ l o t i o n ,

be

served by abank

net

which h i s

industrially

Pank wcvld

business

and

directness

district

business

Its

no

to

"olumbus
of

for

Act.

lines

and

bank

be

agriculturally,

its

the

proportioned bank,

import . n e e ,

h .v e

industry

district

is

woi I d

provision

lies

the m o u n ta in s .

d *?r 3 j W h i c h

Tcderal

land r h ic h

consideration

district,

a well

growing

in the f a r west

with

Reserve

speed

eastern

kind

the

consistent

established

between

have

in

4621

ono

reasonable

Federal

The

^olumbus w orld
too

be

location,

point

east,

five)

agriculture,

3.

net

tho

Giving

port,.nee

each

in

needs

2.

with

P.

the most,
see*

Kiesewette?

L.

t he

y e a r r ound,

d i s t r i b u t e e 5,
other,

no

one

noticeable,

no

inone

a

Sa

L.

city

v e -y f a r

in

As

the

There

are

The
Fhat

to
in

be

I".

Kiesew etter:

The

Secretary

capital

of

the

the

out,

~.

uhe

federal

others.

that hank,
988

I have

National

Treasury:

Treasury:
Reserve

Y^hat

Banks~
is

the

of the T reasury:

and a b o u t

service

stated that,

cf

the

w h i l e you

Very w e ll.

About e i g h t m i l l i o n d o l l a r s

sixty m illion d ollars

of p a id -in

deposits.

An e x p r e s s e d o p i n i o n on t he p a r t

The b e s t

of a m ajorit

o f the con ve ­

p o s s i b l e arrangement f c r

by h a v i n g the head o f f i c e

efficient

a t Columbus and b r a n c h e s

indie .ted »
6 .

d istricts;

No c o n f l i c t w i t h t e r r i t o r y

t o be i n c l u d e d i n

and a d i 8 t r i c t w h i c h c a n be expended or

contracted at w i l l ,




ca p it a .'

o f Col umbus a s a l o c a t i o n .
5«

oth-r

banking

I am s p e a k i n g

o f t h e s e who wo I d b e member b a n k s i n f a v o r

where

here.

Hr. Secretary.

4.

nience

a table

Bank.

I have a l r e a d y

Kiese-vetter *

capital,

o f ma ny

"2 8 9 ,0 0 0 ,0 0 0 .

of

The S e c r e t a r y
2

4c22

Kiesew etter

resources?

I . r . ICiesev.etter:
were

of

district

of

the

lead

size

that

^ecreiary
v/0 \ i d

the

T.

new o r i n t h e f u t u r e .

Pa

L.

7.

If

F.

Kiesew etter

4623

t h e F e d e r a l R e s e r v e B a n k s a r e t o "become

C l e a r i n g Houses f o r

the

t w e e n member t a n k s ,

no b e t t e r p o i n t t h a n Columbus c o u l d

p o s s i b l y be
vol ume

selected,

of cash

speedy

to

w ill

be g l a d t o i n f o r m y o u .

room,

A city

of interest

large

offices

any r e s e r v e

c i t y b-. nker

enough and 7 / e l l a d a p t e d i n e v e r y

and v a u l t s )

27

lines

r e a c h i n g out in a l l
every

all

ready fo r

o f c o mmu n i c a t i o n ,

instant

so

c o mmu n i c a t i o n

c o u l d be i n c l u d e d .

our b reth ren ,

so a s t o

s a v e y o u r t i me and t o g i v e

who a l s o w i s h t o b e h e a r d ,

r'e ap. r e c i a t e

we r e a l i z e

which you a r c

t r y i n g to r e c o n c i l e .

We f e e l
to you f o r

that

a Federal

plenty

of oppor­

t he t r e me n d o u s " e s p o n s i b i l i t ; 1- r e s t ­

i n g upon y o u ,




o f t he

We h a v e made o u r p r e s e n t a t i o n a s b r i e f a s p o s s i b l e

-.s n o t t o W e a r y y o u ,

tunity.

occupancy,

s t e a m and e l e c t r i c ,

d i r e c t i o n s and i n d i r e c t

important point that

(banking

We t h a n k t h e Committee f o r t he c o u r t e s y
hearing*

immense

and a b o u t t he

a F e d e r a l R e s e r v e Bank w i t h a l o c a t i o n

a c i t y with

with

on t h e

items c o n s t a n t l y in the m a i l s ,

of which in l o s s

way f c r

of exchanges b e ­

save time in t r a n s i t

cost

B.

settlement

t h e many c o n f l i c t i n g

interests

the whole arrangement h e r e i n
R e s e r v e Bank i n t h e c e n t e r

suggested'

of the

State

ga

L.

of

Ohio,

ation,
which

an

is

this
you

cannot

w ill

Put
branches
your
and

where
any

rloricua
which

be

one

m inds

that

ideal

veil

called
the

be

trill

be

to

Reserve

further

the

map

Q^24

things
any

into

other

consider­

district

out.
at

Cclum br s,

put

the

can

then

quickly

dism iss

about

this

part

our

realizing

of

of

Banks

you

cares

all

said

upon

indicated- -

country,

ICiesewetter

Taking

one.

so

of

P.

that

greatest

you

good

of

have
for

truly

the

from

great
done

greatest

number.
Tfow
facts

here

in

addition,

which

go

to

I

have

bear

a

out

l«t

fcn

of

statistics

detail

what

I

and

have

of-

t
fered.
A

number

van

have

are

concerned,

answer,
the

a

decided

and

one

districts,

cluded

of

and
of
so

questionn

bearing

on

some

which

of

w hich
as

to

the

w ith
have

you

Colonel

situation,
we

wo: I d

regard
a

asked

north

to
and

so

like

the

far
very

Su lli­
as

*?e

much

arrangement

south

country

to
of

in­

--

The

Sec-ctary

3£r«

Klesew etter:

point

the

w hich

T hfor
e FRASER
re Is a l
Digitized


was

of

Agriculture:
^e ll,

that

broughtcut,

ittle

difference

to
of

Give
is

us

yorr

probably

o--~ n o t i o n ,
opinion

as

a

views
most

cn

that.

im portant

in

the

hearing.

to

whether

the

country
ing

or

which
lendinr

sible.
ing

lending

the

a

rather,

if

to

to

lend

our

matter

are

strs

and

strictly
if
6

we

.re

needs

Bank

«f

ting

a

of

to

lendinr

money,
that

that

class

of

Reserve




that

I

think

and

are
must

but

the

new,
lend
use

Com ptroller

in

and

No.

Board.

5,
to

in

a

do

think

connect­

become
you

must

their

if

dis­

not

say,

hew

much
and

right

rather,
district

Federal

Reserve

thereby

get­

to

try

to

north

and

south

section

not

think

that

I

do

the

ve^-y w i s e l y

would

the

us

much

anything

endorsement,

than
a

«ve
I

lend

their

between

would

told

tankers

line.

piper,

it

not

speak­

bank,

in

should

Bank

lending

observe

We

with

a

I world

have

to

pos­

associated w ith

is,

is

if

prefer

not

district

one

Bank

bor-ow-

and

do

little

interests

territory

properly,

*.re

selfish,

I

reserve,

it

balanced,

would

That

all

Bank.

all.

and

I

he

Reserve

form .

conflicting
Federal

a

Reserve

at

district

e-

view,

territory.

would

one

equally

somewhat

of

have

reserve,

use

that

a

bet

point

Judgment,

to

are

4625

b a n k -s h o u l d

half,

federal

your

they

and

know,

not

your

below

that

ycu

onerous

below

cretion

half

w hich wc

largely

you

the

.no th er

be

ro

in

Federal

ion would

not

included

borrowing

fonsallti€s

a

Kiesewetter

b a n k e r 's

district

was

P.

or

Bankers,

from

w hich

is

L.

reconcile

the
in

would

ga

L.

work

aa

harm oniously

V^ocrvc

Por.rd

w ill

as

he

Kiesewetter

the

other,

called

only

ir.

p^oba

come

about.

You w i l l

- egion,

rcatcn

: a^sachusetts
of

money

which
the

to

lend,

employ

aections

ment

cf

invest
way
to

to

in

r ithe>*
them.

the

The
the

am

to

the

for

They

are

they

And

w 'm ld

of

in

view,

of

the

lending

in

h-ve

plenty

aome

take
and

be

dircctly
practical

the

pl.*oe

the

to

money

that

like

f- .m iliar

prefer

hia

enforce

in

with

endorse­

glad
do

it

tc
that

attached
hard

and

getting

the

fact

can.
the

Reserve

Treasury:

Par.k

endorsement

it

not

w ill

from

all

of

on

lends
those

that

In

to

member

banka,

sco-e.

view

It

of

banks

there
ia

only,

ought

not

that
and
to

rediacounting,

that

is.

Kiesew etter:
tho

Yea,

Reserve

^ecrctary




looking

now

is

The

be

speaking

difficulty

of

wo- I d

Vederal

would

aection

which

territory

any

credit

a

the

be

l_r .

find

but

the

atringenciee

have

he

think

Banka w i l l i n g l y j
they

way.

security

Secretary

South,

I

say,

funds.

Reserve

that

point

Ted^ral

upon

the

than
I

b a n k e r 's
all

of

£ 626

v c ^ f 8eldora t o

aerioua

which world

their

"ed^r.-l
it

moat

and

upon

lending;
ly

the

F.

"*f

the

but

Bank

I

world

than

Treasury:

of

much

the
Put

rather

individual
avppose

the

nave

the

bonkB.
Tederiil

Ka

L.

Reserve
ed

to

that

?oard

lend

it

of

opinion
a

the

to

4627

perm ission,

and

they

you

another",

do

demands

of

trade

and

am

expressing

this

a

-■* i f

it

is

—e a l l y

diversity

r «de-al

and

normal

"Do

lend

the

to

-axae

the

ycu

com

form

of

an

incorporat­

erce
of

t

you w e u ld j

as

in

course

net

get

corme-ce

i n d u s t 17 ,' a n d

of

you w a n t­

responsiveness

sa m e

question

a more

get

the

suppose

not

you

I

pet

said

do

you would

between

you

e t e r

nor

s •:cm
when

give

Kiesew

district,

lend

action,

g-eater

trict,

not

some

legitim ate
w oild

ed

to

district t

freedom
the

did

F.

in

a

dis­

transactions

Reserve

lank

itself

and

the

I

the

ederal

Reserve

member

banks.
Lr.

Oeeerrctter:

District
money,

No.

.nd

5

had

they

think

plenty

knew

th«*fc ,

wo* I d

coir. *. n . c -te w i t h

money

tc

do

not

it8

lend",

think

conacr

The

the

.

Secretary

n e v e r.1

of

havo

to

cxerciec

that

mone**.




them

and

each

the

V*e w i l l
the

the

sa;

_nd

other,
said

the

diac- otion

of

the

and

if

TTe

need

Poard

District

T-'caauy.*:

6 wanted

Ko.

"h»iiruen

^ea-’ r v e

bC~ - Oving;
it8

money

other

Tedcr .l

of

of

one

wo- I d

T*o*

Poard,

two
a-^id

m oney",

if

so^e
Eoarr’a
"*~e h a v e
I

withhold

6 w a n t s money

--

Yes;

suppose

-or

~edrral

^eacrve

poard

o

ahci I d

lend

*.s t o

where

* cu

h-d
Id

L.

it

l.r.

Kiesewetter:

The

‘' e c r e t a ’-y

to

cnc

! r.

_nd

of

it

Pank

the

Treasury:

mifrht

v? ou ld

Kiesewetter

I

say

you

understand

be

perfectly

SfcrPtf.r^'

of

the

The

^ec-eta^y

f'f

Agriculture:

member

their

banks

do

lend

that

the

prefer
it

to

to

the

endorsement

lend
othfr.
of

the

pood.

T~e**sury:

still

m irht

Yes.
Ch t s i o e

business

with

cf

that,

wo*ld

not

other

bank3

in

interest

would

have

district?

Jr.

Ki esevretter:

som ething

to

rate

TJo.

than

The
this

You

ahovld

The

your

4628

Yes.

Kieaevetter:

serve

T.

do
6 ,

it.

If

rrobably
of

i-ranrcmcnt
doinr

the

with

C,« c - e t a ~ y

lumbus

Yes;

rr.te

Vo.

Vo.

8

business

world
with

a

8

world

offer

would

pet

Put

-here

Agriculture:

which

of

prevent
mer.ber

a

the
is

*. eir.be-

bank

in

a

better

money.
nothinr

in

bank

Co­

in

Jackson,

I ies-

issippi.
L r .

Kiesew etter:

The Secretary ^f
Ir .

Kiesew etter:

prevented
continue

The

from
to

do

secretary




You

mean

lending

Agriculture:
Xo,

borrowing

not

Yes.

«n?r mo>«e

money

direct?

in

Vew

t h a n we
York

if

would

be

re w a n t e d

to

so.

of A r r i c u l t u r e :

I J u s t w a n t e d to b " i n g

out

fa

L«

the

fact

tinue

to

he- e

that

your

dc b v e in e s B

V .r . K i e s e w e t t e r :

business

Crc-Pta~>'

V .T ,

Kiesew etter:

ar.'-thinp a t
T h#
it

ove^
Yes,

they

country

Yes,

but

co ld

would

?ut

that

still

con­

country.

in that

firr i c v l t u - e :

of

banks

th? w hole
but

4629

net

continue

to

dc

decree.

* ou h *.ve t h e

privilege

does

privilege.
not m ean

all.

c- eta~~

crc

Kiesewetter

in dividual

cvp- t h e w h o l e

The

P.

taken

of

Agriculture :

You m i g h t

howl fcr

it,

if

*r*a y .

I",

''ics**

ett-*»*:

Thr

^ec- eta- y o f

I m ean w s do n e t
the

"’- c . s u r y :

It

have
ie

in*- p r i v i l e g e - -

one " O u a l r e a d y

- cised.
1 ".

in

Kieee

2 lo sieo ip pi

are

not

The

h .v c

Yre;

dees

.nq\ . i n t e d

C'e c r e t a ~ y

s looted
we

cttcr:

0.8
Tern

thr

of
h

w hich

not

mean

ith

the

diofict

this

there

Suppose

for

either

tio- ninr,

-our p r e f e r e n c e ?

2y

p- eference

w h i c h **ou n. . r




situatio n

be

i s me*»t c e n t r a l l y

loeated
out.

to

- n y th in g t o u s ,

.d q u .~ t e r s

co nsidering

! 2i c a r - e t t :

che p r i v i l e g e

Ar~ic- l t u ' e :

p r o p o s e , w h a t rro I d
IT’*.

but

in

row,

wo*: I d
the
if

l e a n m oney

be ca v.se Wr
at

all.

? o l u m b u s '. e r e
the

district

or t h e

be

for

not

w hich

district

-ou

the c i t y

district,

the

in P i s t r i c t

Vo,

5 w hich

gi.

L,

y o u h*-ve laapped

out

cenier

possible

,.s

it

is

x.

there,

Tliesewett e r

Cleveland

to pet

is

4630

about

as n e a r

the

a c i t y w h i c h w o * .Id be
S

suited

for

land.

If

cinnati,

the
the

location,
district

Ohio,

is

Indian**.,

vro- I d

n a tu ^all** be

wo

Id

b»

or

Cleveland,

rerfee

and

the

.re tro* I d n a t u r a l l y

favor Cleve­

m apped « u t w h i c h w a s m a d e

" e n t u c k ’: a n d T e n n e e s e e ,
ccnter

l y v.*fll

bccause

i“

cf

-chat

section,

s a t i s f i e d -vith a b a n k

one

i s as

convenient

to

in C in ­

Cincinnati
a n d ' *e

at

Cincinnati,

us as

the

other.
The
of

^ecreta- y

the
i~ .

Agricu lture:

o f ''o l u m b u s a t

Klcs€uet*»cr:

point,
The

business

of

a

division

- e c - e t a -:* of

Doth

cast

What

are

the

directions

present?
-nd r e s t .

po int

between

the

treasury:

It

is a

through

Kew Yo~ k a n d C h i c a g o .
‘T h e re

do "-or k e e p '-our

r« oe rv e c?
. r.

Kies- . e t t e r :

The

rf c r r t a ""

l*r.

Ki^se

the

7he
yo* r

in

I

C h ic .p c ,

controlling

shcvld

''l r v e l a n d ,

-<c *c4 -ry o f




A rricvltu^e:

cttcr:

e-ir.c a s r i t h

pe- f'ent

cf

I n r ew Y o r k ,

-nd t o n

"h ic ag o

^Tiat p*-rcentac*e

sa y t h e
60

per

per

Agric- I t u r e :

consideration?

-nd S t .

in

e _ch?

p e r c e n t a g e v:as p r o b a b l y

cent

cent

Lo- .is.

in

in

Y o u n .k c

Krw Y o r k ,

St.

30

Lovis.

acces3ibility

f®-

I.*

~ r• Kiesevetter:
la- r- ~
on

arount

counteThe

in

*=*<c *

ta~y

a

c o n *- o il;n p

at

conven ien t

~i

the

TCiesc :c t t e r

so

im portant,

chur .c t e r
b

4c'^l

Ic c > .v sc

s i n c s s u ’^ i c h

is

poinr

c o n s i c 'e - a t i o n

To what

the

cf

if

':**rinch^ s

,r c

'Z ic scvrettef*:

The

r ? c " c ; (i*7:

of

TTicsc* e t t e r s

Tho

^ c c " ' 1ta-*' o f

w he- e
;;r .

inpo- tant,
th*

cr

in th e

Ar- icvltu- c:

I

do n e t

if

1 0 do a l l

vay of c o l l e c t i o n .
Th- rc

se e

Arricultu~ c :

I

.1 1 c




ed th e

sho I d

is

nc I m i t a t i o n

in

. irattr"

It

sir •

And

of

I

im agine

do v h r . t f v f r

think

Ar^icxiltu- e:

headqua^t?rs

Tticeevetrer:

tion i s

established

s e e t h a t i t m. keB a n y d i f f £ ~ e n c c -

cor. *:c-.ld allc-7 iftcns t o

L-.

vey

tlwt

apparently•

1 ".

cf

the

I f b - . nchcs u r e e s t a b l i s h e d a t c c n v e -

I do n ot

~ c r c i A '-

bod'

on a c r o s s

pointe?

v c i r n - i n o f f i c c s ..re

l*»w,

/roinp

e x t e n t t/ o - I d

y o u r b r a n c h o : f i c e s a r e p c i n r t o be p e r m i t t e d

Th

he

o f b u s i n e s s vrhich i s

of A c r ic v lt u r e :

e ~ tir~ :

nirn*. p o i n t s ,

th-

of

a hank.

be

1 -.

Th>-_t i s

of that

;.s con:; .-"sd t o

V.

is

ciny : / i s e
nec€ OB.v— .

so.

In

that

c .so

it

o ve- w h el :iinp c o n s

is

not

so

qucnce,

is.
depends,

b^m ch.

ua

I

o ffices,

pay,

ho*« m uch d i s c r e ­

b e cu u sc nhon

it co.ies

?-a

L.

V.

Kiesevetter

to the rediscounting p r i v i l e g e ,

1632

I do not kno.v -h .t that

poorer wculd bo d e l e c t e d by the main o ffic e to a l l the
branches, world it ?

Of course it is relative--

Seoreta-y of A f r i o v l t u r e :
so-t ol

The~e world have to be so,.»e

sup "-vision, bvt those branches do net hive liore

cum 4*-’ " s ;

t h e " h :v p

l r . K ie s e v e t t e r :

seven d ir ec to r s, a e you know,
Yes.

The Secretary of A g r ic u lt u r e :
have d is c r e t io n

Y*ho unquestionable world

>nd -esponsibility?

l r . Ki f so*" t t p r :

Y s.

But I cannot r r t away f^on: the

thovrht that the- T70: i(j pro> ably be c o r s id ia r y in quite
a

decree to the . .in o f f i c e .
T h ' *?«c-eta**y of Ap-^iculture:

I ij.is^ine the spirit

of

ce-o;>€ n t 1 cn world c on trol.
2-.

i?se**€ttcr:

Gh, ~ es.

The ''-c-ota-y of Ar~icrltu-e :
Th ‘ r tc-*c:a-" cl * he T r ea s u r y ;

I think that iE a l l .
Just one p o i n t .

In view

cf -.he p o s s ib le exe-cise by these rederal deserve Panks
e-. '’ l c r i n p Kouse fu n c tio n s in tho diffe-ent d i s t r i c t s , ycu
at* .ch

.d d it ie n a l

iaport .nee to the n a t .e r of a c c e s s ib il i t y

of the ?ed?~tO. ,,e8'-rvf Tank,
l r . K ie s e w e t t e r :



do **o*r?

So much sc,

hat -e ..re p erfec tly w i l l i n g

pa

L.

T.

Kiesev.etter

463o

to w aiv e int -eat on b a l a n c e which we r.re now petting,
a d d i t i o n to c o lle c tio n f a c i l i t i e s ,

if

in

e can pet collection

f ac i 1 i t i e 8.
The ** creta-*:- of the T-eiiSuryt
b ^ j i c h would e x ir c is e
1'*** K iesew ettc**:

Of course, there ajrain the

. v e —y important fu n c t i o n .

I wc* Id presume ac, but 'ro\\ have to h .ve

a c*nte~ around which the tranches c
The ^ c c r c t a ^ ' of the Treasury:

jn

also operate

I vnde^atand t h a t , tut

in a compact d i s t r ic t -. **. Kiese* c t t e r :

v cs,

hioh t h is ia--

The ' ' r c i t s ’*” of Ahe Treasur:,';

7he~e ia a lot which can

tc done between the b^anchea and vh:
telep~aph

.dqua-tera by

.nd tele phene.

} r . Ilice

ctteri

Y e s,

but the;* cannrt exchanre dheckB

that way.
The *?ec**eta— of the t r e a s u r y :
balances.

I ik ji

!-o, but * ou can exchanre

t O B .r , ycu car. ascertain t a l .ncc a in that

way.
L-. K ie s ev *tter t

vca.

The e<fl?«ta-:* c f

he ,,'-'e..8u-y:

ret

And in that way vou can

the ^eirittances very ouch quickt r than othf^wise?
r.;csE




fV- '•*;

Yee.

L.

T.

Kiesewet rer

The Cco-e tury of the "- c a s u r v :
ors

.a being- of

her.d o f f i c e ,

do you?
Yc s ,

sir.

'c c - Pt^:* of Ar'"iculture :

c.ition b;

t l £ f ” ^ph

You h-ve excellent conr-ium-

.nd by telephone to «ill th ese points?

I ” . *Iiea e. t i i c r :
frotr. the

consider those f a c t ­

p~eat import &nce in the location of the

i ~ . Xleac e t t e r :
The

So -C”

46 M

Y c e f indeed.

e .8- t c the we a t ,

Tc ht_ve «vfr- through line

and * e hri.ve twenty- 8 even r.-.il h.nd

.-1c i t r i c l in e s c^nt r i n g in "oluicbua.
Th- ^ ’ c r e t o f A g r ic u lt u r e :
i n t : r>*upted by s t o r m ?

often

1 " . Kieaevetter:

Very seldom.

'Toi-e p e o p l e

consider

Indrpwn<*<nt

s* stcr. a n d

c^n^rct
p ",

The

and

the

it

is

Vc h .vc two systems.

a

blessing.

reil

Telephone

a

" e h-;ve the
^ 's i r u ,

..nd t h e y

"--diu 3 f "Oir Vc-w Y o r k t o

V ' r~

Chica-

-.n" i n t e —

s ldorr. ” e h -ve

.

*Vc- fta- y o f

p eability
oou-ae

t h _t n e t

8Vf~ - thinf w it h i n

c o r p l e ’. e l : * ,

ratio n

tion

Are your telephone lines

between

t^ut

very

1‘- . T.i{>?



wo

id

1 .- pel;

. ctt'-r:

the

T r e & a v .r y :

these
extend

Independent
the

If

ind P e l l

r-idius o f

f r o m -i eotauon p o i n t ,

Yep.

?ut

,-ov r e t

un

^atecs,

telephonic
wo*ld

ince-ch**nof

con rniCi-

i.t n o t ?

he opinion seems to p-evdil

T*

L.

now t h a t
«.re

ie

not r ^ i n e

P.

to he d o n e ,

r.ov? Y r a n c h i n r out ard

.d

Kiesewetter

B . o r j H d p e n d i n r the

46 35

rind the

In d e p e n d e n t

fellow:

e x t e n d i n g \hci- l i n e s w h er e t h —

possible

n e g o t i a t i o n s b e r een the

1*0.

Th - S e c r e t a r y o f
ape Jcinr o f the

th e T '*caBu»"1':

effect,

Kieae*.?ette**:
The

^ec- eta—

of

if

Yea,
the

Yes,

I w a s only

th it n j s b r o u g h t a b o u t .

it -o I d

"-eftsu— :

be n u c h b c t t ^ .
That

is the

T

c o n n e c t io n

of
Th *

I~d- pendent

c wc.-.ijf the
r.

effective

*‘i e o e w e t t e r •

telephones,
Th e
the

a r .a
Yea.

w here we

rvc- eta~ *

l i n e s w i t h the
oi

both

Ae

it

.dd- rnsed

i s n o w ,w e have

o f th e T r e a s u r y :

to ''lev-* l a n d

lines

w o r l d in-

systems?

forr>e~ly h a d but

"o lu r .b a " l c -rinp H o u se

have

Pell

to have

two

one.
should l ik e

ecnair* r the ae

; 0 h .ve

q uestions

.s be inp a d d r e s s e d

e

tc the

C o lu m b u s "1< . r i n r Houa* .
Tli £ae e t t e r :
largely

Yea.

I t h i n k thoa>’

a r,. te- w h i c h w o u l d

not povr~n

b e c a u a e w h e n t h e a e ^ e a r r v e P a n k s pet
w ill
Th e

h av e

to f e e l

^ee- eta—

l ir in a - il *- .



o p i n i o n s w o v l d be
so v-rv s f o i r l " ,

into

operation,

th ey

t h e i r way a lo n p .

o f the

’’***eaaury:

” ell;

it

is

of v .lve p.T-;-

pa

L.

The

l,; c - c t a T

par* r ,
Of

that

of Arricvltv- e :

i8 the advantage

-at ion i n s t e a d
The

of le- vinp it

of en-.cti n r it

Th ese h c . - i n r e are

s c h e d u l ’ d c it i

cn t h i s
-ok t h . t

svrject,
it le

If

n w or

( hc- euycn,




th.

at 1 2 : 1 5

f-Oiu,
o-

if

That

is

additional
thcr..

ill.

e ls e w i s h to

ther:

these

is an;*one
in fo n a .t ic n
only

i n f o r m t .t io n .

he .r in p w i l l tc

P.

.djninistrative

and now that

p ublic,

e w ill hear

.d d .t ic n a l

th r- is no ne,

a d j o u r n e d .)

P o e s an ''O n e

ne*: 1 ip ht

t h e ToLsait:

to

into a l«.w.

e h.-.ve b-->ri he .rd

hc- f ~ho c .n co- - i b v .e

4636

As 1 0 the ecu. t 'c i a l

*>cc-eta~7* o f the T - e a su r;’ :

t r hf-urd?

was

Kiesewetter

.d jc u r n e d .

th e he..-inp at Cleveland